Industrial Development Bill, 1977: Second Stage (Resumed) and Subsequent Stages.

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

Mr. Connaughton

Last night when we adjourned I was speaking on those aspects that are not in the Bill. I had just mentioned the fact that there was grave doubt about the future of the tax-free holiday for industrialists coming to this country. I should like to start this morning by pointing out the serious problem of unemployment. It is doubtful if there is a more important debate on any matter in this House than that relating to industrial development. It is not often that in one maiden speech one gets two bites of the cherry on two consecutive days. However, that is the way it turned out. Of all the scourges that has ever hit this little nation of ours we are certainly in the middle of the worst ever in so far as the unemployment situation is concerned. Whatever length of time might be given to a debate on the Industrial Development Authority is worth while.

There are three major areas that the Bill should have dealt with in so far as the IDA are concerned. As I said last night I compliment the IDA on their ability on the foreign markets to attract industrialists here. One could say that there was a time in the history of the IDA that the only thing that mattered as far as industrialisation was concerned was our ability to get a foreigner to set up here. The next step was to get as big a foreign industrialist as possible, perhaps a multi-national company. Generally speaking we arrived at a situation where the emphasis was entirely on big enterprise. There is still a great place for that type of involvement by multinationals provided it is handled properly. The only trouble is that in the recent past some of the multi-national companies have not turned out the way we would like. In this regard I note the proposal there that the IDA would be in a position to take equity shareholding. I should like to know from the Minister to what order or on what scale this would be. After all if we only had 5 per cent or 10 per cent shareholding we would have very little say in what those other companies might eventually do.

Secondly, it is very important that we have in the IDA the best selling executives that is humanly possible to find so that we may explore to the full the foreign markets. Córas Tráchtála and our industries abroad should be brought more into the picture because it is vitally important that we succeed in bringing here industrialists of the right type.

The next category and that at which the Bill is more geared is the small industries category. While one would say that we have been reasonably successful in this sphere, in areas outside Dublin there is greater scope for getting small industries both foreign and Irish, than we have been getting of late. However, the advent of the advance factory system has been helpful in this situation. A number of commentators at the time of the introduction of this system were of the opinion that these factories were not such a good idea. They asked what was the point in having a shell of a factory, but as time went on, and particularly from a parochial point of view, it was seen that it was better to have a shell of factory than to have no shell at all. In many cases the IDA filled these premises, although not always with the success we would have liked. This is a problem that I would just like to mention in passing. For an area that did not have an industry before— and this applies in particular to the smaller towns in rural Ireland—there is a great tragedy if the first attempt at industrialisation is a failure, because then it is certainly much more difficult to get a second industrialist to come in. Consequently I would make a special plea to the IDA to ensure that in so far as possible the first industrialist, however small he might be, in a small town is successful when he begins production.

I should like to say also that a lot of lip service has been paid by the IDA to the need to back the local man who has a good idea. I refer to a number of cases that I consider should have been backed. I will not mention them by name now because it is not relevant as such, but I will apply my statement to the pre-cast concrete business. I understand that in the provinces this is not to be grant-aided by the IDA on the basis that it is a product which might be over-produced and could be counterproductive, thereby creating competition for firms that were already given assistance from the IDA. The Bill should have included something on this particular item because if you take a case, particularly in the west, where a local individual with enterprise, enthusiasm and ability is in a position to give work to 35 or 40 people on a project like pre-cast concrete products, he is as entitled in that area to be helped as a farmer might be in some other area. I would make a very special plea to the Minister that the IDA would have a re-think on this aspect.

I should also like to mention another obvious area in which the IDA seem to have clamped down on all types of grants, that is, the joinery business. The same thing would apply here where we have a number of people who are providing very good employment in areas in which there is very little employment. It is a step in the wrong direction and I would certainly ask the Minister to review this. I am particularly sorry that it is not included in the Bill.

Down through the years and until quite recently the Industrial Development Authority more or less forgot about the processing of agricultural products. Thankfully in the last three or four years there has been a major reversal of that trend. Two or three out of every five of the total labour force are engaged either directly or indirectly in employment related to the agricultural industry. Therefore, it is very important that we ensure that there is grant-aid for this type of enterprise. The real wealth of this country is in land, forestry, bog and sea. The Industrial Development Authority can and should be involved to a far greater degree in developing those resources. A typical case in point recently concerned boglands in Ballyforan where it was decided that that area would not get a generating plant and that the plant would be sited in an area better favoured than the bog area. It is very important that the IDA should get involved where the raw materials are in order to ensure that under-developed areas get their fair slice of the employment cake.

I make a special plea for the Industrial Development Authority to get involved in research and development in the field of the diversification of dairy products, an area in which only recently the IDA saw fit to get involved at all. I have no doubt that in the years to come, because of our climatic conditions and the high quality of our grassland, many more jobs will be found in this sector. There is scope for much more research into the development of new products and this, too, is an area in which it would be worth while for the IDA to involve themselves.

There are also jobs available, provided we play our cards right, in the meat industry. There is much comment on the fact that cattle should not be exported on the hoof. Within the terms of the Bill that is not strictly correct. As we all know it is very important to provide jobs from the actual slaughtering of cattle and the sale of carcase meat as such. Here again the IDA should play a more active role. It would be a very bad day for farmers if the entire franchise for the livestock business was handed over to the meat factories. From a farmer's point of view nobody is likely to forget 1974 when most of the cattle had to be slaughtered through the factories and not alone were the cattle slaughtered but a lot of farmers were slaughtered as well, pricewise. We would not like a return to that situation. Competition is very healthy. Our aim should be the creation of as many jobs as possible in that sphere. There are other facets of the livestock business that will supply many more jobs and at the same time allow a certain number of our cattle to be exported on the hoof in order that the primary producer will be paid for his time and trouble.

The service industries which are important also are not mentioned in the Bill. One might say this is getting away from the philosophy of the IDA but while Dublin is having grave problems in relation to job creation it is true also that there are certain areas in rural Ireland that have employment problems all the time. The only reason for Dublin being in the news at the moment is that for the first time in many years it has had problems getting industry sufficient to meet the needs of its people. It is all a question of extremely bad planning.

What happened in the past few years was that it appeared that everything one would want had to be based on Dublin before it was right. We had a situation arising where almost every industrialist who came to this country decided to place his plant either in Dublin or not in Ireland at all. We arrived at a situation whereby, to a lot of people, Dublin was Ireland and there was no place else. As I have already mentioned, in the last couple of years there has been a welcome trend away from that. In relation to the total job creation the rest of the country, and particularly the less favoured areas round by our western coastline and the north-western area, in relation to what has been achieved over the years, has done relatively poorly. The last few years saw a reasonable increase but the baseline was extremely low.

With the advent of free trade it is quite likely that a number of firms from the Continent will want to open distribution centres here. There are a number of firms in Dublin who, because of lack of space and problems of that nature, would like to locate in areas where they sell a fair amount of their products. The IDA should give them every help to decentralise on that basis because a job is a job no matter where it is and a secure job is most important at this stage.

I should like also to take this opportunity of mentioning the great imbalance there has been down through the years in relation to jobs. The IDA have done their best in the past four or five years to redress that imbalance but if they are not successful in that regard and if the lack of planning in our industrial progress in the years ahead continues on present lines there will be a type of jungle created in Dublin whereby the burden of the infrastructural needs of a city of this size and of a growing nation will be too great on national resources. There are very many schools, churches and community halls to be built in Dublin while in several areas in the west we are closing them because of lack of use. This results from the population imbalance.

I wish to emphasise that the problem being experienced in Dublin in regard to jobs is a problem that we have been having in the less favoured areas for many years but which went unnoticed. The only reason there is a clamour about the Dublin situation is that there are so many people there. However, two wrongs never made a right and I would ask the Minister and the IDA to ensure that there is a very good distribution of jobs. If an industrialist decides for transport reasons, or for reasons of infrastructure, that it is a better proposition to be nearer the commercial life of the nation, suitable incentives should be organised in order to encourage him to consider other areas.

The small industries division locates industry in the smaller type towns —towns with fewer than 2,000 people. I do not see anything in the Bill that would indicate that there is any kind of pressure or enthusiasm for this sort of development. I do not have to point out that once a population base declines in an area, particularly a rural area, the essential services we have come to realise we want for our normal daily living, will probably disappear altogether. We are fast approaching that in certain areas in the west. Up to now we have generally a family doctor, a priest and a veterinary surgeon in the one parish but the day is likely to come, if we are not careful, when those people will have to cover three or four parishes. There are not enough heads to pay the taxation burden. The day may well come when the woman living in the west may have to travel 25 miles if she wishes to avail of the services of, say, a hairdresser. The important thing in any area is to have people there and they will only stay where jobs are available.

I particularly like the joint venture unit proposed in the Bill. This gives our Irish bodies like the IDA a foot inside the door. We are in a better position to know what is happening. We trust this will work out very well. We have a number of agencies that have worked well under very severe handicaps in the past. I refer in particular to Gaeltarra Éireann and SFADCo at Shannon. I have no doubt that part of the IDA's success lies in that part of their organisational structure whereby they have regional offices. It is very important that this part of their business is expanded because irrespective of what particular walk of life you come from there is a big advantage in having a thorough knowledge of the area you are hoping to industrialise. Gaeltarra Éireann and SFADCo are living proof that undeveloped areas can and will be industrialised if we have the right type of people with the right type of commitment.

In the very near future I hope the IDA will get around to some of the things I have mentioned. While we have to look to the IDA in terms of outside industrialists, it is very important that there is close co-operation with the county development teams, whom I also congratulate. They have done a fine job. There will be a bigger area of activity for those people in the future and I think the most important thing from now on from infrastructural and industrial points of view is that there should be great emphasis placed on planning. I was very much struck by a documentary on RTE last week relating to Holland. The Dutch plan in such a way that they avoid having cities that sprawl for miles and miles. Their planning ensures a balance between urban and rural populations.

Finally, I make the plea that great interest should be placed on the small industries division and that every effort be made in the next year or two to ensure that any Irishman, no matter where he is, in Dublin, Galway or Mayo, who has a reasonable idea and there is a chance of his plan working should be met more than half way by the IDA. I am led to believe that we have been prepared to take a reasonably risky chance with a foreigner up to now and that an Irishman had to be 100 per cent sound before he was trusted. I hope an Irishman, no matter where he is, will be given every chance in the future.

Mr. McGowan

Most of us welcome the opportunity to look at a Bill that will help industry generally. This new legislation will help the IDA. It is only natural that we should have to have legislation periodically to cover changing patterns and scenes in the industrial world. We all realise that we have come through a difficult time in which we had sluggish promotion in industry. The viewpoint that I should like to put, and I am sure it is shared by many, is rather than have a change of emphasis in the last four years, more recognition should have been given to rural Ireland which has suffered most in that period. The towns that were on the way to getting industries got advance factories but they have been lying idle. If in a small town a factory is lying idle for a period of four to five years, it is difficult for someone to establish an industry because no other person had the courage to go into that industry. There are measures in this new Bill which will help this imbalance. I am very hopeful that the Bill will encourage the IDA to new promotion of industry, and rural Ireland needs a shot in the arm as far as industries are concerned. There are many advantages in the bigger industrial centres such as Dublin and Shannon because they are highly organised in telecommunications, transport and so on.

In my county we have had about six advance factories built in a period of four or five years. In my own town, Ballybofey, there is a factory known as "the cobweb factory". I think all of us recognise how difficult it is for the Government and for the IDA.

Small industries—prefab, concrete and timber based—have been mentioned in the Bill. The Government and the IDA are aware that in the past these may not have had the full support of the IDA and the answer the IDA put forward for not supporting these industries was that if they had supported one person they would have had to support another person ten miles away, and you would finish up by putting one or the other out of business. The IDA realise what happened because of their reluctance to help small industries, especially in Border counties: it is now recognised that concrete and wood based industries have flourished, especially in Northern Ireland, with substantial grants. Not only were they getting grants there to establish those industries but they were also getting grants for the 40-foot trailers and articulated vehicles that were drawing the concrete products and the wood manufactured products. Anyone who travels in Border areas and stops at a customs post, whether it is at Newry, Derry or Strabane, will see these lorries drawing concrete products, concrete blocks, readymix concrete and fabricated trusses for roofs. All of these products are taken in here to the detriment of our small industries and it has now reached the stage when it is no longer the Border counties that are affected but the entire Republic. I am satisfied that the IDA now realise what is happening, that the island is very small, and that they must take recognition of what is happening across the Border.

This puts a new focus on the whole pattern of small industries and the Government are aware of this. I am hopeful that we can look forward to a completely new approach from the Government and the IDA to small, home-based industries. This will be very valuable. Sometimes there are great celebrations when a big industrialist comes into the country, regardless of how much it costs, and tries to get on. We recognise that it will not always be like this in rural Ireland. There is always the danger of the withdrawal or failure of an industry in an area that is so dependent on it.

In the last four years we had great hopes in Donegal of a fairly large industry being established. It was announced that a firm would establish in the county, would employ 1,700 workers and the Government would support the establishment of that industry with millions of pounds. The total number employed is 170. We have to ask ourselves was it ever intended to employ more than 170 and was the 1,700 employment target only a carrot for the IDA and the Government. These large companies are capable of supporting their claims with documents and figures and computers. There is no end to what they can do. They are capable of showing that they will do something which they might not intend to implement. Only experience can show this pattern up in the true light. We have had difficult years and we needed the new legislation to get out of a situation in which we were completely tied, dependent on people from outside who draw heavy grant support to establish industries, some of which may never materialise to the extent of the expectations of the local people. The experience we have had can show us how important it is to have a re-think.

This legislation will make us all aware of the change in scene and attitudes. There is now an air of confidence among people who are interested in promoting industry, and rural Ireland will stand to benefit. We have a lot of potential for industrial development. Industries based on agriculture, timber and other resources which are available in Ireland are the industries which should merit our maximum support because they are the most likely to succeed.

I do not think raw materials should be imported from one part of the world and the finished product exported back. There is a very simple saying that the place to can the apples is in the orchard. We now realise how important it is to support small home-based industries. I feel certain that the Government, the Minister, the Parliamentary Secretary and the IDA are aware of it. I am hopefully looking forward to more employment being given by small industries throughout Ireland. We have all got to play our part in encouraging small employers who will employ two, three or ten people. That would be the greatest contribution and the soundest approach towards solving our unemployment problem.

Mrs. Hussey

It gives me keen pleasure to welcome the Parliamentary Secretary to this House—I have not had the opportunity before. In doing so I should like to commiserate with her on the discrimination which she is likely to suffer when she takes up her new office in the New Year, but let us hope that discrimination will be abolished before too long.

It was interesting to see in the recent past a shift of emphasis among thinking people with regard to investment in industry, one which is not before its time but one which needed big problems to bring it to our minds. It has been said that small is beautiful. People running schools are now appreciating that; people designing and building churches are appreciating it; in the theatre world it has been appreciated for a long time—you do not find large theatres being built any more. Those three spheres have a common factor—people. We are all very much aware that when we are talking about the IDA and industry we are talking about people, because that is what economics is about. Sometimes economists are inclined to forget that.

We were shocked recently into a reappraisal of the position by the Ferenka debacle. We are now beginning to think that there may be room for different kinds of industry. There has not been enough emphasis on the talent of the Irish people. All over the world we can see that the Irish people are very talented, ambitious and skilled in many areas. We have to inspire that sort of skill and talent to work in this country and not, as has happened in the past 50 years, in other countries. By encouraging and approving this Bill we can show the confidence of the State in the people, which perhaps has been lacking up to now.

I believe that if we concentrated on developing what is indigenous in Ireland we would preserve what is beautiful. It has often been said in this House that it is not too late for us to avoid the mistakes of Western Europe. In a way, our economic underdevelopment has had some advantages in that we have not ruined totally what we have. In ten years' time we could have something unique in Europe that would attract the kind—some people do not like this idea—of high-spending and quiet-living—I do not think they are mutually exclusive terms—visitor in search of peace, quiet and real, which does not exist in many places in Western Europe. We could build a prosperous Ireland by using what is special to us.

I know some of the problems attached to developing a small industry based on native skills and materials, a weaving industry, for instance, and I can see the enormous interest growing abroad, particularly in North America, in the very high-quality hand-made products made from native materials. Such products must be of high quality and very special. The IDA can be of enormous help in this area.

I should not like to conclude—I am very conscious of my university colleague, Senator Murphy, who wants us all to speak for ten minutes—without suggesting to the IDA that when they are encouraging small industry in rural Ireland they should remember that one of the problems facing rural Ireland has been the flight of young women from rural Ireland. There have been no employment opportunities for them. The cottage falls vacant, the men leave and the whole thing is a vicious circle. I should like the IDA not to perpetuate distinctions in employment. The reason I say this is that at the top in the IDA there are no women, and indeed the same applies to all our semi-State companies. I should like to remind them that there must be joint employment in rural Ireland to make for a healthy development.

Mr. Hyland

Any Bill which gives greater power to the body responsible for the establishment of new industries is very welcome. To the extent that this Bill gives greater power and scope to the IDA it is welcomed by every Member of the House. I want to join with other Senators in congratulating the Government and the Minister on having introduced this Bill. I should also like to join with other Senators in welcoming the Parliamentary Secretary. I am sure we all look forward to the day when we can call her a Minister of State.

One can say that if some of the provisions in the Bill had been introduced before now many of the industries which were forced to close down in the past would not have done so and many new industries might have got off the ground. It is in this respect that I welcome the provision in the Bill which refers to an enterprise development programme. I hope that this section of the Bill will be exploited to the fullest possible extent. We all know that the establishment of small industries will solve, in the long-term, our employment problem. We all know from our experience at local level that there are many entrepreneurs who are anxious and willing to set up small industries but for one reason or another they have failed to do so because of their fear of failing. Finance has been one thing which has prevented many small industries from getting off the ground.

I am glad the Bill contains a provision whereby financial encouragement and incentive can be provided for the establishment of small industries. We have plenty of expertise, we have plenty of people who are willing to take the risk, but for the reasons I have given they have been reluctant to do so. I feel that the IDA in the future—and the Bill is making provision for it—should give encouragement and provide greater incentive for the smaller man who wishes to establish an industry at local level.

We all give a thought and lip service to the massive unemployment situation, and without doubt it is a very difficult problem for any Government to resolve. But if we took the unemployment situation and broke it down to local community level and if we could see established in every community small industries capable of absorbing the labour force within that community from year to year, we would go a long way towards resolving the unemployment situation.

Senators referred during this debate to regional imbalance in relation to overall industrial development in the country. I fully agree with the sentiments expressed in this regard. We have the greater Dublin area expanding year after year at the expense of the towns and villages. This is a vicious circle which will continue unless some steps are taken by the Government to ensure that we have balanced regional development, and the Bill, in so far as it encourages the IDA to encourage the establishment of small industries in rural areas will go some of the way towards correcting regional imbalance.

If we are to tackle fully the unemployment situation our efforts must be in the industrial sphere because agriculture, we know, is no longer capable of absorbing our surplus labour force. Senator McCartin said last night, and I agree entirely with him, that it is fine to talk about the creation of jobs in the public service— additional school-teachers, gardaí, other civil servants—but in the long term, unless we can create productive jobs, we will not make any real progress in the field of national development. Therefore I would urge all the people responsible for job creation, particularly the Government, the IDA and the other State agencies, to ensure that as far as possible the new jobs created will be in the productive field because they in turn will generate more jobs for that increased production.

I should like to re-echo the sentiments expressed here last night by Senator Mulcahy when he referred to the need to buy Irish. I would see our programme of national development, our programme of industrial development, as being a team effort on the part of the entrepreneur, the man who is establishing the industry, the Government, the IDA—the State agency responsible for it—and the consumer.

The number of people who are clear in their demand for Government intervention, for IDA intervention in relation to the creation of new jobs, of new industries, is amazing, yet these people feel that they have no part to play, no obligation and no commitment in relation to the purchasing of the products of these industries. Senator Mulcahy said last night that in the region of a 10 per cent swing in products would create about 10,000 jobs. If we want to be sinn féiners, if we want to make a practical contribution to our overall development, surely this is a field where all of us can make a practical contribution.

The body responsible for promotion of Irish goods in this country, the Irish Goods Council, has been doing an excellent job, and it is our task, and it should be our responsibility as responsible members of society and representing people at national level, to ensure as far as we possibly can that the maximum support will be given to the Irish Goods Council, the people who are operating the programme at that level, to add our voices to theirs in requesting our consumers to buy the products of our Irish labour force, of our Irish industry.

We have it in our own hands to create the jobs, and the Bill before us at least will put us on the right road. But it will fail completely unless we as individuals play our full part in ensuring that the product of our Irish labour force is bought.

It is only in the last 15 to 20 years that we have really shown any real concern about the importance of industrial development. I want to stress the importance of a training programme for the people who are responsible for running our industries because in new industries many of the people would have very little expertise or knowledge in relation to management. I would hope that the IDA, the Government, or some other agency will ensure that having set up industries, having encouraged them to embark on their programme of development, these people will receive backing and training to enable them to manage these industries in the best possible way.

In relation to the progress of our new and existing industries there is a great need for a more responsible input by our Irish workers. It is very easy, in relation to the Ferenka and other disputes, to be critical. I do not want to be critical because I know that the vast majority of our Irish workers are dedicated and committed people, but particularly in relation to new industries and the difficulties encountered by new industries in getting off the ground, unless there is a genuine commitment on the part of the people who are working within these industries to get them off the ground in their early critical days there is little hope for success. I would hope that everybody responsible for workers, trade unions, Governments and everybody else would try to encourage and foster this kind of worker participation and involvement. In the long-term it is the workers and the country who will benefit from this kind of involvement.

I do not want to become too parochial and I hope the Chair will not rule me out of order if for a moment or two I get a little parochial. The Parliamentary Secretary will be rather familiar with what I am about to say. There is no question about the important role which the IDA have to play in relation to national development. As the national agency responsible, the IDA have done an excellent job and are deserving of the congratulations and the thanks of everybody interested in national development, but I feel they have not succeeded in bringing about the balanced regional development which other Members have referred to.

I speak from some experience in this regard of my county of Laois. Senator Keating, too, will be fairly familiar with the situation. I was glad to be associated with him at the opening of one of the advance factories in Mountmellick which is still there unoccupied. If I refer to Laois it is because I am more familiar with the situation there than I am with other counties. Our population in Laois has been declining steadily in the past ten years.

When you talk about under developed counties you generally think in terms of those west of the Shannon. Yet I come from a county which is only one hour driving time from this city. The town of Portlaoise is situated on the crossroads of Ireland. We have one of the greatest arterial road networks in the country. Laois County Council have provided and serviced a very large industrial site in the town of Portlaoise and in other areas of the county, but for some reason or other, and I am not blaming the IDA specifically, it has failed to attract any kind of worth-while industrial development into the county.

Perhaps the House will bear with with me—I will conclude in about two minutes—while I am giving a brief example of what I am talking about. In the period 1969-70, of the 112 new industries established in this State one industry came to County Laois. In 1970-71, 78 new industries were established and Laois did not get any industry. In 1971-72, there were 72 new industries established and Laois got three industries. In 1972-73, of the 105 new industries which were established we got one industry in County Laois. In 1973-74, there were 123 new industries established and we got one. In 1975, 91 new industries were established and we did not get any industry in Laois. In 1976, 142 new industries were established in the State and we still did not get any industry.

During this time our population was declining. Our school leavers had to seek employment in other counties. To get back to the point made by other Senators, the structure of our communities within the county and in other counties has been sadly undermined and eroded because we have not been able to establish on any kind of regional basis in rural areas the industries which would have absorbed our surplus labour force. It is important to note that we in Laois made a case for designation eight or nine years ago and we were told at that time that if we dropped the case for designation the IDA under the grants available at the time would redress the situation in Laois and create new industries. That has not happened, and I am not pointing the finger in any way at the IDA or anybody else, except to say that for some reason or other we have not developed the county and our county town as we would need and as we are entitled to develop it under the agency of the bodies responsible for industrial establishment. The point I want to make, and I am concluding on this, is that out of the 11 counties which at that time were designated as under-developed, seven now have a higher income than my own county of Laois. That adequately bears out the point that there is a need for balanced regional development and that the IDA should use the additional powers that they have to ensure that counties like Laois will get their fair share of industrial development.

I welcome the Bill and I wish it every success. I also wish the Parliamentary Secretary and the Minister every success in pursuing the objectives which they hope to achieve through this Bill.

Mr. Keating

I do not think I have made what could be called a political speech in the Seanad since I became a Member, certainly not a party-political or partisan one. This one is going to come out that way, in response to the sense of amazement that I feel at the way in which some Senators have been treating this Bill and perhaps the most egregious was Senator McGowan. This Bill substantially was introduced by Deputy John Kelly on my behalf in May in the Dáil. It is not new in general; there is a tiny amount of novelty in it. I am aware of the genesis of most of the ideas in it, and they were discussed long before they appeared in any draft legislation. Most of them originated over a period of years within the IDA and not on the part of any politician, myself or any other. The ideas have been generated by the experts in industrial promotions themselves. This Bill does not represent any significant departure in industrial policy or any basic new assessment. It represents the very proper sharpening and improving of facilities that have been developed over two decades and that in many ways are the envy of other countries, because the IDA is a remarkably sophisticated and, by and large, very successful organisation.

It is important to emphasise the lack of novelty and new departure. I am no believer in novelty or new departure for its own sake. I did not institute radical changes of direction or reform in the IDA when I became Minister for Industry and Commerce because what I found there was good. I hope that I was able to broaden and deepen and properly fund the work of the IDA. I hope that that bi-partisan approach to the question of industrial development will continue. I suppose that what will happen in reality is that the sensible people who are in the positions of authority will continue a bi-partisan policy and the Senators McGowan of this world will go on making the sort of speeches that he made just now. I hope that a more sophisticated public than we have had in the distant past will come to laugh at those sorts of partisan politicised efforts to distort economic history, because laughter is probably what they best deserve.

I want to say a few things about what I see as the difficulties and threats to our industrial development and comment on what seem to me one or two myths which have come from all sides of the House in the speeches that I have heard. I will start by putting into context the work of the IDA and the progress of our industry and our industrial production and exports. We came through the recession with a better industrial performance than any other country in the Community. I have made that a single simple sentence without qualifying clauses because anyone who looks at the figures will see that it is true. In terms of annual growth of production and exports we had the best performance of the Community. This is a very remarkable tribute to the IDA and to the fact that the fundamentals of Ireland as a place for investment are good.

That was masked by two things. It was masked by the destruction of certain sectors of our industry due to competition from within and outside the EEC—things like footwear, textiles, clothing, furniture and so on. It was also masked by the remarkable demographic revolution that is taking place in our country, where we are flipping from a country of declining population to a country of rising population and from a country of old people to a country of young people. This is a very remarkable demographic evolution which in my view makes the current policies—and I say this in regard to the past Government as well as the present one—for industrial development necessary but inadequate by themselves. I have always believed that however successful the IDA were, and they have been very successful, we need a major innovation in the public sectors for job creation as well, for those fundamental demographic reasons, and that we need a structure of planning such as had been outlined in the pre-election document of the Coalition. However, I am not going to pursue that because it is not relevant to this Bill.

Let us recognise, lest we lose our balance in the light of very recent events, that we have had a remarkable success, masked for the reasons that I have said, but nonetheless remarkable, and when something like that is attained it is not attained by a political party or a Minister or a Government or even an institution like the IDA. Nobody has the right to claim credit in any individual or partial sense, because that is the work of the whole economy. It is the work of management, of the labour force and the financial institutions, the planners, of the infrastructural people at local government level, of the people in the public service. Often the best politicians can do is to stop doing any harm. It is not the work of any single group; it is the work of everybody. We must affirm a success because it is important to us psychologically, and any unbiased examination of the figures will document that success. Any unbiased comparison with the performance of the other countries of the Community or of comparable countries outside the Community during the relevant period will document that success. Let us put ourselves into that background of great objective difficulties, very rapidly evolving and difficult demography. Those things are the same for a new Government as for an old one. We ought not to be ashamed of what we have achieved; we ought to be very proud of it. We ought not to turn away from it in the light of something like Ferenka.

In passing, I should like to say that our incentive package—and this money is about the incentive package—is the best in Europe. There may be particular sectors of Northern industry, because they have a more flexible system than ours and one which is more prone to distortion than ours, where they can be relatively advantaged. One can make an individual comparison about an individual firm and say they are a bit better off in the North than in the South. That is true, but in general our incentive package is the best in Europe. It is recognised to be so and it is one of the reasons, though there are other important reasons, why we have had the success we have had. I hope that success will continue.

It is dangerous when examiniation by the Brussels authorities, specifically by the Commission, of our incentive package becomes a matter of public debate. It is extremely important that the security of that incentive package be defended and extended. In my period in Opposition I have not and will not do anything to rock that boat because it is very important that we defend that package. The great argument as far as I am concerned and which I offer to the House and to the public in general is simply the following, which I have always found to work in Brussels in my time: I have always said that they have the right to look at and question and argue for the diminution of our incentive package at the time when they have a reasonable and real regional policy which will transfer wealth across national boundaries in significant quantities but until they produce that in Brussels, will they please let us continue doing what we have been doing successfully? In general, that is an argument that works. The public debate, particularly internationally, and in the minds of potential overseas investors, is a dangerous thing from which we ought to stay away.

I do not want to talk about Ferenka and I have not done so. I am hopeful that it can be resolved. It is not helpful to go into it in any detail, except to say that I believe that attempts to apportion blame in larger or smaller quantities to the different participants is counter-productive. Anyone who says that it is all the workers' fault is talking nonsense. Anyone who says it is all the management's fault is talking nonsense. Anyone who says it is all the Government's fault is talking nonsense. Let us say in some sort of equity that nobody emerges with great credit and that everybody has some responsibility for what happened and for what we all regret. Let us hope that it can be resolved satisfactorily. The more we drag it about and the more one sector abuses the other the more harm we do for a continuing programme.

What is it that investors want? They want the sort of package of incentives that is funded under this Bill. They also want a few other things. They want the sort of long-term political stability to enable them to look down the decades in doing their corporate planning to see that the basic rules of the ball game of industrial investment will not change They want stable and good labour relations. That does not simply include relatively low costs. Let us say, and our workers know this as well as anybody else, it is true that the total cost of wages, that is, the pay packet plus the social cost of health, pension, social insurance and so on, is lower in Ireland than in other Community countries. In some industries it is less in Britain than in Ireland but in general it is a little less in Ireland than in Britain and it is a lot less than in all the other Community countries.

The cost of labour alone is not a crucial determinant, provided management can be sure that that labour can be productively used and that expensive plant can be used continuously and will not be subject to official or unofficial stoppages; and also that there will be a level of confidence on the part of the labour force so that productivity can be continuously raised, and that more intensive forms of production can be introduced without stoppage. Good labour relations are crucially important.

I shall not enter the area of inter-union disputes and the echoing reciprocal abuse that can do much more harm than good, except to say that if one has to choose between the rights of different sectors then let us choose the agreed and official mechanisms. I suppose we all as human beings have experiences of organisations we do not like. If at times the organisations we are involved in work badly, are unjust, are inefficient or undemocratic, the thing to do is not to kick over the beehive and start a new organisation but to make the organisations democratic and make them work. Anybody who sets up a new organisation, or who competes and disregards the normally evolved rules by which disputes are settled, is doing damage to the basic structure. It is true in politics, in trade union relations, and it is true in everything else. The prudent, helpful thing to do is to endure and reform from within rather than subdividing. The power to get high productivity, high quality of product and reliability of product, is extremely important to a potential investor.

I should like to comment on some of the points made by other Senators. I find two myths gaining currency. Because of Ferenka and because we are all a bit traumatised by it, everyone is saying something like the following: firstly, we should not be pursuing the large, we should be pursuing the small; secondly, we should not be pursuing the foreign, we should be pursuing the Irish. Senator Hussey said "small is beautiful". Senator McGowan talked about a reasonable chance, that an Irishman had to be 100 per cent sound before he would get aid from the IDA whereas they always take a reasonable chance with a foreigner. I believe that in the past, before my time as Minister for Industry and Commerce—and it is still true—the IDA, if they make any differentiation between foreign and indigenous make that differentiation in favour of the Irishman. It is paranoia to suggest that we are always better to the foreigner than we are to our own. That is not so. The IDA is beating the bushes of the country looking for valid Irish entrepreneurs in whom to invest. There is no skewing of their aid effort in favour of foreigners, and I do not believe there has ever been, or there ever will be. I know the personnel all over the world as well as in Ireland. I have worked intimately with them and derived great pleasure and benefit from so doing. They do not have this inferiority complex because they have had considerable success and because they are good professionals. They do not skew their activities against the indigenous.

Then there is the question of big or little. Would not it be nice if we had the option to choose? We never have chosen. Because Ferenka was big and foreign, suddenly we have to go for domestic and small. We have always gone for domestic and small. Why choose? Ten jobs in a village is marvellous; 1,500 jobs in a town is marvellous. We have to have domestic and foreign. We have to have big and small. In the wake of Ferenka we must not be driven, as public representatives, to say we have neglected the small. Nobody is more interested in handicrafts, in small industries. I hived off Kilkenny Design Workshops in my time and gave them more money and more autonomy. Senator McGowan says we should use the timber, use the food, use the indigenous things. Yes, of course. I was the first Minister who ever gave a grant to the National Crafts Council. Of course we must have craft-based industries but if we do not get the big foreign ones we are cutting half the possibilities. We must not make that choice as a nation. We must do both things. Small is beautiful but so is big. Why do we have to choose. We do not have to choose; in fact, we have to do the opposite. We have to keep them both going. It is necessary to say that the IDA should not be biased towards foreign as against Irish and not biased for big against small.

Let us count the victories as well as the defeats. Ferenka is a defeat but it is a perfectly surmountable defeat. I would argue, in fact, that the fundamentals of that plant were always wrong. I will not argue it now but let us do both things and let us not be driven to chauvinism in our efforts. Let us not be driven to concentration on one particular sector. We have always kept overseas and Irish in balance and we have always kept big and small in balance and that leads me to a third myth.

I will not quote the different people who said it but a number of previous speakers seem to believe that the great wen of Dublin is getting bigger all the time and sucking life out of the regions. Senator Hyland has a point about the middle of the country. What happened down the decades was that the natural power was functioning in gathering people and investment in Dublin and Cork and along the east coast and we made a major national policy down the decades of looking after the west and that was functioning a bit. The whole middle of the country was forgotten and there is no better example of that than Laois.

Let me beg people to look at the IDA documentation. The periods are too long to relate them to one four-and-half years. The periods of growth and relative decay are determined by international factors as well as domestic ones but one can see the growth curves of different areas. The IDA in their regional development plans have done very careful and detailed work and it is available in the library. I would ask Senators to go and look at it because it does not show the third myth, as I have been calling it, that Dublin is getting bigger and industrial jobs are being sucked out of the rest of the country. It shows that in recent times the place that has suffered most is Dublin, more than the midlands and I am not making a case that the midlands' performance is good. The worst sufferer has been Dublin and next has been the midlands. Places like Cork, Limerick and Mayo, the west regions, the south-west and south regions of the IDA are the areas doing best.

Let us base our arguments on readily findable facts. The readily findable facts show that that tendency of Dublin to predominate and suck everything out, very properly identified in the past as a danger, very properly skewed the work of the IDA away from the promotion of Dublin to the promotion of other areas and that is showing results and it shows up in the figures. If we are really to move the resources around we must realise that the IDA cannot do it. We must have a structure of real planning in order to move resources around the country. It is not just about factories, it is about infrastructure and all sorts of things. If we do not have real planning we will not have harmonious development.

The IDA can help very much and already have helped very much. When you have a myth you do the wrong thing. Dublin has suffered, the midlands have suffered and the strip in the hinterland of the Border has suffered. The west, south-west and south, even the south-east, have done relatively well and those facts are ascertainable. I simply want the resources to go where the need is and that need is findable and documented and is being continuously measured by the IDA and they are switching resources around depending on need.

I think I have said disjointed things but I was worried about the trend, and it was not in a party sense because I found some of those myths coming from this side of the division, but let me just sum up by saying this. First, there is a bi-partisan approach and a continuity of policy in regard to the IDA which I think is proper and which I applaud. I do not think we are really divided at all on those sort of issues. Secondly, let us say and agree that they are very professional and very good and that they will spend well all the money we can afford to give to them and get value for money, so that a Bill like this can be supported, as, indeed, it is supported all around the House. In the wake of Ferenka and particularly with a change of Government, let us avoid, firstly, denigrating past achievements because it is psychologically important to everybody, to the whole community, to affirm the successes we have had as well as having the courage to affirm the weaknesses. Let us not denigrate past successes. Let us not emphasise change because continuity and stability are extremely important in the work of the IDA and in the work of industrial promotion and let us also not foster myths like the myth that we must suddenly stop the promotion of what is big and foreign and devote our attention exclusively to what is small and indigenous, because we need both. Let us stop the myth, which is a myth, that Dublin is sucking the rest of the country dry. The figures do not show that. We can only have rational resource allocation when we affirm what actually exists and what can be readily found out by looking at this figure.

Mrs. Cassidy

It was very heartening last night and this morning to listen to the accounts of the splendid work being done by the Industrial Development Authority in developing and promoting industries. Our history, our traditional role first as a pastoral and then as an agricultural community, our lack of raw materials and the fact that our industrial arm is situated in the north-east of the country—all these have been factors that inhibited the growth and development of industry. That is why the work of the IDA must not be hindered or impeded by any irresponsible act.

In this context how could one regard the action of an employer who dismisses or merely suspends one of his workers who refuses to perform a menial task? This is the sort of menial task, I may add, that in our society is usually regarded as the exclusive preserve of the housewife. How does a potential foreign investor react when he reads the comment of the governing body of trade unions in a neighbouring EEC country who, in commenting upon recent inter-union rivalry in this country, remarked very acidly that they did not believe in waging their wars upon the backs of their workers?

Most workers do not like strikes; most workers regard them as a disaster for themselves and for their families. Of course, there is the lunatic fringe but I do not see how any Government can legislate to control the lunatic fringe without interfering with the civil liberties of the majority of workers. The lunatic fringe should be looked after; it is the function of the trade unions to look after their own intransigent members.

I do not want to wander from the point but in talking about trade unions it has always been the source of the greatest amazement to me that the wives of trade union members have never clamoured for and never got a voice on the trade union council. After all, they are the one who suffer most in strikes. They are the ones who have to tighten the family belt and, more important, have to support in silence their husbands' principles whether or not they agree with them. One can only applaud their silent fortitude down through the years. In the final analysis, this is a matter of responsibility. We must relate our responsibility as legislators, in extending the activities of the IDA, to the responsibility of those who will use those extended facilities, the employers, unions and the workers. The responsibility of us all is to see what an eminent churchman recently called the "obscenity of Ferenka" will never happen again.

Mr. Kitt

I welcome this Bill. I am not concerned with who introduced it because the ideas in it are good. The extension of the Industrial Development Authority's powers, developing the domestic industry, particularly the small industries and helping the emergence of new entrepreneurs, are good solid ideas. The Government, as other speakers have said, are committed to creating new jobs. This Bill will help in that regard. The Government have already introduced employment incentive schemes, have helped the building industry and have recruited extra teachers and gardaí. That is only part of the job. You have to provide for productive jobs. I am sure the IDA will continue their good work in providing those jobs.

I welcome particularly the extension of the small industry cluster concept and the building of advance factories. I feel that many industrialists, particularly Irish industrialists, have difficulty getting premises to produce their commodity or goods. In my particular county, the county development team have done quite an amount of work in providing pre-fabricated structures to help local industry. Only for them and the advance factories that have been built by the IDA we would not have the amount of employment that we have. I agree with the speakers who mentioned the need for help for the pre-cast concrete industry and agricultural machinery. They only receive help from the county development teams and in many cases are not able to produce as much as they would like. They are not able to employ as many people.

The promotion of industry, particularly in rural areas, goes hand in hand with the promotion of the infrastructure and the other services. I hope that this policy will continue and that water and sewerage facilities and so on will be provided in rural areas. As the Parliamentary Secretary said, we need overseas projects for many years to come. I hope that the IDA will keep in constant touch with these new industries. It would help to provide the sort of situation that people have been talking about as regards industries folding up or not having enough backup facilities.

I know the IDA are keeping in constant touch but it is most important that they continue to do so, and even work more diligently to help these companies. The Minister mentioned the need for bringing different expertises together. This is a very good idea. Instead of having duplication of resources the heads of different Departments and State bodies should be brought together and the expertise pooled. As regards new overseas projects, as I have stated, we need them urgently and the IDA have estimated that the overseas projects will provide about half of the new approvals needed for 1977-80.

Reference has been made to the imbalance between the different regions as regards the provision of jobs. The former Minister, Senator Keating, mentioned that the western region has done so well. There are regions within the western region and the IDA have set these down in town groupings. As regards the town groupings, in north Galway, for the period 1973 to 1976 there was a 20 per cent loss in employment in those town groupings. That was something in the region of a nett loss of 200 jobs. When one looks at those regions and the figures provided by the former Minister one finds they do not reflect the true picture of the unemployment situation in rural Ireland.

There is another imbalance also, that is that there are very few job opportunities for young men. I have heard people talking here this morning about discrimination. I certainly agree there is discrimination in many areas of our society against women. Certainly in the north Galway area, job opportunities are there for young girls and women but they are not there for young men. I hope the Parliamentary Secretary will impress upon the IDA the need for male-orientated employment in this particular area.

Help could be given by the IDA to the food processing industry and industries related to agriculture. There are quite a number of young people very interested in agriculture. Our committees of agriculture have training courses for young people. This is a great help for them. They will know how to improve their farms and also they will know about new enterprises and how help can be given to create extra jobs in agriculture. One of the difficulties for companies who want to increase their competitiveness is that there are pressures on them, as Senator Keating said, of rising costs and increasing competition on the home and on the export markets. There should be business confidence in the country. A change of Government of itself gives business confidence, irrespective of what party happen to be in power. A stable party, as we have now, after an election, will give business confidence but companies have competition problems.

Mention has been made of the research and development that is needed and how science and technology can do so much. Unfortunately, in recent years, the IIRS did not get adequate finance to carry out their work. In the report for the year ending 31st December, 1976 the chairman expressed his grave concern about the inadequate finance they received. I hope they will receive increased finance because they are doing very important work and they have a big part to play in the creation of jobs. I do not know what the figure for youth unemployment is at the moment. It has been estimated that in the EEC the figure stands at 2,000,000. This gives us an idea of the big task facing the Government. The Government commitment is to create those jobs. Semi-State bodies, like the ESB and Bord na Móna, have provided jobs for apprentices in the past few years and they should be complimented on the great work they are doing.

I hope that in my area of Galway Bord na Móna will sanction the building of a peat briquette factory. We certainly need employment for young men in our area. Something must be done to remedy this imbalance between male and female employment. Whatever about the EEC situation, we cannot blame outside influences or world trends for our problems. We have to stand on our own feet. I hope the Government and the IDA will carry out that programme of creating those jobs.

Mr. O'Toole

I want to compliment the IDA on the wonderful work they have been doing in connection with the development of industry throughout the country and especially in my area of Mayo-Galway. Over the past number of years the regional manager there has programmed the development of industry as we had elected. Like all development in road structure you first of all go in and take your spinal roads for development. In the same way, the IDA went in to the bigger centres for the development of industry there in their spinal locations.

Most Senators who have spoken here today have advocated development in provincial areas. The most progressive small farmer in the west is the part-time farmer who has a day-to-day job and has sufficient capital to put back into his small farm as a result of industrial work in his nearest provincial town. In his local community he is one of the people who is regarded as a progressive young farmer. For that reason there is a certain attraction for the young girl who wishes to marry into that particular smallholding because this small farmer gives her the incentive we have not had in the past.

We have more family units being created on the land in the West because of the off-farm employment. We must focus our attention towards this in the future. If we have to have a farm modernisation scheme we must ensure that a condition is enshrined in that scheme whereby this small farmer will qualify for all the necessary grants available under that scheme in order to keep that family unit on the small farm. That is very important and something we should project towards. People come first.

In the last decade, and in the previous decades the trend was to move to the bigger centres such as Dublin, Cork, Limerick and other places where there was intensified industrial development. The carrot was waved and the workers on the land moved to the cities. I was delighted to hear Senator Moynihan and other speakers from the rural areas making their comments in connection with the same type of environment in the West where I come from. Senator Moynihan also mentioned the spoiling of our tourist amenities by the inclusion of a small industry in a particular provincial town in a tourist area. That is a myth. If you want to stabilise and develop industry you can do it easily along with the development of tourism. You do not spoil the amenities if you have controlled development of industry in those provincial towns. I am not at all for the people who say you can now commute 40 to 50 miles to Galway, Sligo or Asahi to work and come back every day. The roads are too dangerous for that, expenses are too great and the remuneration from industrial employment does not warrant this type of travel. You need the industry in the closest proximity it can be made available.

I want to pay special tribute to the work of the county development teams. I hope this Bill will give them greater scope. I am a member of a county development team. Somebody said yesterday that the IDA should be more involved in county development teams. At every meeting we have, an IDA representative is present and he has his finger on the pulse of what is happening in the development of the county under the development team. The establishment of the smaller industries that have been assisted over the years is something that should be commended. If these smaller industries are given more scope for capital investment it will go a long way towards helping the small family industry down the road which is competing in an open market in order to give employment to his family or to ten or 15 men.

Our county development officer in Mayo travelled to Britain in order to encourage Irish people from Mayo, who have been successful there in the various bigger towns and are now anxious to come back to Mayo, to return and set up industries, small and large, depending on the individuals. We are doing research on this at the moment. Most of our progressive Irishmen who have left the country and accumulated wealth in foreign lands who now wish to come back and help their own people in their own area should be given every encouragement to do so.

Senator Hyland mentioned the "Buy Irish" campaign. That is a very patriotic rostrum to be on at any particular time. I want to say to our Irish industrialists—it was mentioned by the previous Minister for Industry and Commerce—that if you produce a high quality article you have only to show it around the world and it will sell itself. That is the "buy Irish" campaign we should pursue. It is very easy to say we want a united Ireland. That is a popular saying, just the same as we say "Buy Irish". It is the product we should expect from our industrialists. If we get this product it will sell itself.

Ferenka has been mentioned. I will not dwell on it. My experience is that the American industrialists coming here are free of trouble labour-wise and they have the best labour relations of any other foreign industrialist. The reason is that our people and the American people are integrated. They have got to know each other and their ways of life. That is why we have good labour relations with our American industrialists on the floor of the factory. I suggest that it is important to have somebody to liaise with the overseas industrialist who does not know the Irish way of life. The Irish people do not take compulsion too lightly. If we had a liaison officer he would give the industrialists from these third countries the necessary information from the bottom to the top. If there is liaison between both parties there will be a better working relationship. That is very important.

Mr. Jago

This Bill has been welcomed by all sides of the House and I also welcome it. I do not want to cover all the points that have already been covered. I just want to make two points. I do not agree with what Senator Keating said. This Bill, to me, is a component part of one plan where the Government are creating and giving the opportunities for development. I am not capable of answering whether or not Deputy John Kelly actually put this Bill through the Dáil. Up to now the only incentive to help existing industry to become more efficient was the re-equipment grant scheme. When we had protection of industry, several manufacturers were in the same field of industry competing against themselves. That was all right when we had protection. When we got into the competitive field those factories had not the output to develop the full use of their plants and machinery and, therefore, they became uncompetitive. This particular finance needed for mergers and acquisitions can rectify a situation like that. In other words. it can bring two or three units together and thereby make full use of one plant and get full output from the factory. The point is that if this was done three or four years ago we might have saved some of the factories we lost.

On the other points I do not wish to say anything except that naturally they are welcome. Research and development projects obviously are welcomed by us. We are no longer what is called an under-developed nation, we are a developing nation. Therefore we should look on ourselves as such. The shareholding powers of the IDA show that the Government wish them to get ahead with the job, to cut corners, because what we want are jobs.

Reference was made to Ferenka. I do not think Ferenka has anything to do with this whatever. Senator Keating said that it had influenced this Bill—in other words, that we were placing greater stress on the smaller rather than the larger industries coming in.

The problem of Ferenka is in a diffcrent field. It is in the field of industrial relations. It is not the only difficulty in that field. We know that the Minister for Labour is looking into that matter and we should leave it to him. As far as we are concerned, we are still interested in bringing in industry from outside and we are more than interested in creating industry from within.

I welcome the financial help for the first-time industrialists. This is an area which is ideal as far as this country is concerned. It will mean that initially you will have small industries. They will be labour intensive and will probably not cost us a great deal in capital. If we take risks and some of them fail it will not be a calamity. Those industries will probably be started by people who have new ideas or people who have special skills. These are the points which I wish to bring out.

We have examined the Bill carefully. We know everything about it. We know what can be gained by it. Probably tomorrow the trade unions will know about it, the chambers of commerce will know about, all these people will know about it. What about the fellow in the back of beyond who has an idea? Will he know about it? Therefore, one point I wish to bring out is that this scheme should definitely be promoted by way of pamphlet or otherwise through any channel we can think of, through trade unions, to every member of a trade union, through our schools, regional colleges, the NIHE and universities so that the people will know that it is there. You cannot expect the IDA to find them. They will have to find the IDA.

Another point is that in our schools and colleges the skills that we seek are probably the skills which are already used in the existing industries of the country. They are not the skills that will create the new industry. We have to find out the new skills and, therefore, consideration should be given to a survey of what the demand is in Europe in the big population areas and then import new skills and thereby create new industry. I welcome the Bill.

Mr. Lanigan

Like other Members of the House I welcome this Bill. There are a few points I would like to make. One of the first things which has come out of the Minister's speech is the question of mergers and acquisitions. I wonder are we correct in approaching the matter of mergers and acquisitions in the manner set out in this Bill. Too often we see that in a merger there is a weak partner going into business with a strong partner. Very often neither business will be helped but the strong one will be weakened.

In the sixties and early seventies, for example, the Shell companies took over lame duck companies. The lame ducks remained lame ducks and the successful companies became less successful. I sincerely hope that a lot of thought will be given to any question of mergers or acquisitions into which the IDA will go.

It has been said that we came relatively unscathed through the economic morass of the last four or five years. I would suggest that one of the reasons for that is that a large proportion of our small industries and of our industry generally is based on the agricultural sector. I have not seen any industry based on the agricultural sector go out of business in the last five years.

The biggest problems have been in the larger industries but, perhaps, this will always be the case. The IDA have done a good job in getting capital from outside. They have done a fantastic job in certain areas. I wonder if their idea of "small" and my idea of "small" is the same? I see the problems in rural areas where a man wants £1,000 to set up an industry which will support two to three jobs. By the time he gets the authorisation for that £1,000 he might be gone out of business. The research conducted by the IDA before they give grants is so intense that in the end the person who needed the £1,000 could be gone to the wall. There has been mention of risk. In the IDA, as is the case in all semi-State bodies. nobody seems to be willing to take a risk. If they take a risk they see it as their head that is at stake, not anybody higher up the line, and they are not prepared for this. We have within the IDA a new project identification unit. This is a good idea. In the November issue of the IDA News I noticed a report that the IDA are giving £75,000 to a project which would manufacture saw blades. The report stated that the market is here and that the blades, in the main, were being imported from abroad. There is a company in County Kilkenny which has been manufacturing saw blades for the past eight or nine years, which has come through a very difficult period and which is working under the “Guaranteed Irish Scheme”. One of the first things the project identification unit do is to give £75,000 to a competitor who has been importing these items. I do not mean to be parochial but if the IDA are going to set up a special unit to identify new projects they should do that and not be competing against firms already in the field. They should be supporting the existing companies and helping them to expand and not diverging capital and the manufacturing capabilities of the particular firms.

The IDA are very good in terms of their work with economists and accountants but they are not very good when it comes to dealing with the man who has been a foreman in a small factory or who is working on the shop floor of a small factory, who has a good idea and wants to set up on his own. That man has to prove to the IDA that he does not need their money before he gets it from them. It is the same with the banks. The Minister said that the banks only lend on assets. There is no bank to which you can go at present which will lend on assets. The bank will lend on your potential ability to repay. It is the potential ability to repay and the potential of the project which should be examined and not the financial projections that an accountant can work with.

The IDA are not supporting new developments in the light engineering sector because they say that too much money has been given already in grants and that if they gave any more to this sector they would be killing the industries which they have already helped. I do not agree with that policy. Generally speaking, the people who set up in the light engineering businesses are people who have worked very well on the factory floor and have good ideas. Initially they might set up a factory to make cattle crushes or gates but if they find that the market for cattle crushes or gates is not there they can get their pipe bender to turn another way and they can produce something else, because they have the brains and they can see the potential in other areas. This is an area in which the IDA are again failing.

The support that these small engineering factories give to the agricultural sector and to the manufacturing sector is of enormous benefit. There is no point in going to a major factory on a Saturday evening at 7 o'clock to have a machine repaired but if one goes to a small light engineering company run by two or three people the job will be done even if they have to work over the weekend and they will not ask for overtime or ask why they should do it. These people are of enormous benefit both to manufacturing industry and to the agricultural sector.

Again, the Government or the IDA give no help to support, say, garages in country areas which are of benefit to the agricultural sector. Garages in rural areas are as much an integral part of the agricultural scene as is any manufacturing entity anywhere else. They provide a service to industry and they should be helped.

Regarding small industries—I am talking about industries based in small factory units supporting two or three jobs—there is scope for expansion. These industries can be of greater value than the multi-nationals, especially those multi-nationals who employ about 1,400 people but who leave after a relatively short period, causing disruption in the lives of all those associated with them.

In Kilkenny we have seen the benefit of the smaller industries. Some people call them workshops. We are talking of the tradesman who sets up his own small unit and employs one apprentice and maybe in five or ten years' time that apprentice will set up his own small workshop and he in turn employs an apprentice and you have an extension of employment in a small way. In the country areas that is the best form of industry.

I would not like it to be said that I am totally critical of the IDA. They are doing a wonderful job and this Bill will give them more teeth to do the job better but I would wish that they would forget about the Master of Business Administration from Harvard, or the people who come out through the IMI, who go down the country visiting people who have never gone to Harvard or who have never gone to the IMI but who have more brains and more potential than these people. The IIRS report earlier this year proved the validity of that when it was stated that out of every 25 or 30 people who had acquired the most capital and who had built their businesses to the greatest extent in this country had never gone past national school level. This is something of which we should be proud.

I have nothing against people with degrees or people with academic qualifications but we should not lose sight of the value and the potential of people who have not got these qualifications. Too often semi-State bodies are inclined to believe that without a university degree or without an academic qualification one is not of benefit to society.

The tourism industry has been mentioned and it has been said that there is a possibility there would be a danger to the tourist industry if we develop industry in certain areas. There is no doubt that major complexes would ruin the amenities of certain areas. It is all right to be talking from our lofty position here but if you are without a job in Castletownbere, which is a beautiful place, no different from being without a job in Dublin. Cork or elsewhere. It is grand for people to be talking about the preservation of amenities if they have jobs and it is very easy to say: "Do not cut down that tree because it is a beautiful thing" but if that tree were to be knocked down it might provide much-needed firewood and the person needing the firewood would not be too concerned about the preservation of the amenity. The people who are involved talking about the preservation of the environment, or the extension of industry to the detriment of the environment, are talking from upper-middle class situations where they never had to worry about breakfast, lunch or dinner. I would appeal to these people to consider the implications of not developing industry as against the preservation of the environment.

Again I welcome the Bill. I sincerely hope it goes through and that the IDA will work along some of the lines I am thinking of and that they will be as successful in the future as they have been in the past.

Parliamentary Secretary to the Minister for Industry, Commerce and Energy (Mrs. Geoghegan-Quinn)

First, I should like to thank the very many Senators who have taken part in the rather lengthy debate on the Bill. In particular I should like to thank them for the many tributes which have been paid here both last night and this morning to the Industrial Development Authority and to particular officers in different regions within the IDA. I may say that some of the tributes paid were critical and I think were all the more worth while because of that criticism. None of us, and particularly no Government or Government agency, should be afraid of constructive criticism from anybody. If it helps to better that organisation or to better that Government, then it is to be welcomed.

Some Senators felt that a more comprehensive review at a later date of the powers and functions of the IDA should have been brought forward but such a review at this stage, apart from the fact that it would delay overdue and very necessary legislation—and this has been brought forth by many Senators—would inevitably have led to some diversion of scarce resources at a time when urgent attention must be given to the whole question of job creation and job maintenance and related industrial promotion. However, from what I know of the Minister's thinking I would envisage that the main emphasis in any such review— and he has undertaken to have that comprehensive review at a later date— would be on how to intensify and give greater impetus to the development and expansion of domestic industry, especially small firms located in smaller towns. If there is one theme which might be said to have run through the debate it is the most urgent and the greatest problem confronting us and confronting the Government, that is, the problem of job creation. The Senators have been saying that the Industrial Development Authority have a major contribution to make towards the solution of this problem. Senator McCartin said that the Bill is not envisaged as a panacea for all our ills or for the very great problems of employment and job creation that confront us. It is intended as a major contribution but it is not a radical solution of job creation and the industrial development problems generally. In the coming years we will need every job that we can manage to create on a sound basis but we will also need to maintain every job in existing industry that can be maintained on a sound basis.

The Government cannot possibly hope to solve our unemployment problems without the fullest co-operation of all the people throughout the nation—industrialists, workers with Government aid and aid from Government agencies must help themselves. This is a point which was consistently referred to by different Senators. This morning one Senator referred to the "Buy Irish" campaign and I would refer the Senator to the reply given by the Minister in the Dáil only last week when he said that the Government feel that not only must we buy Irish but that we must think Irish and we must also sell Irish.

Very many of the Senators who spoke both on a local basis from their knowledge of their own areas and, indeed, who spoke about the whole national problem of industry and the problems facing the IDA, spoke about the role of the IDA vis-á-vis domestic industry. It is an inescapable fact that we must continue to attract new overseas projects. This will continue to be the case for very many years to come. But side by side with this, as Senators on all sides urged, we must do everything possible to maximise the contribution which domestic industry, particularly small industry, can make towards increasing output and employment.

The IDA are at present organised in special divisions dedicated to small and domestic industry and to recognising their special problems and needs. More staff resources of the IDA are allocated to these areas than to overseas industry. This is a fact which may not be well known. The contribution of domestic industry and in particular small industry to the IDA's overall programme has been particularly encouraging during the past number of years.

In his opening remarks in the Dáil on the Second Stage of this Bill the Minister pointed out that the purpose of the Bill is to facilitate the IDA in giving more financial and other assistance to domestic and small industry. He mentioned the Government's commitment—and it is an important one—to double the rate of project approvals for small Irish industries and he mentioned various measures which have been introduced recently to enable this target to be met.

Senator McCartin made some good points about the impact of small firms on the employment problem. Again this goes back to the whole question of the advice and the aid whether financial or otherwise, which the IDA must and do give to small, domestic Irish industry. He felt—and I think it was an important point— that more consultation was necessary between the IDA and both sides of industry. Senator Butler and various other Senators expressed some concern about the attention which is now being given to Dublin. Some Senators were afraid that this might lead to fewer opportunities for employment elsewhere in the country. This is certainly not what the Government would want to see happening because we would hope that small industries would develop in Dublin which would be additional to and not instead of industry or small projects elsewhere and that the larger industries being attracted to Dublin at present would not have been contemplating establishing elsewhere in the country before they established in Dublin. This has been the case in the past and I would hope that it would continue to be the case in the future.

There were references made by Senator Mulcahy and others to Ferenka. The whole question of Ferenka was debated in the Dáil at length last week and it has also been the subject of public references by the Minister for Industry, Commerce and Energy, by the Minister for Labour, the Taoiseach and others. But the comments which have been made by the Senators lead me to say that our industrial incentives generous though they are would in future be of diminishing value to us if in the eyes of the world there appears to be the prospect of a Ferenka-type situation occurring again. There are, as all of us agreed here this morning and last night, many problems to be sorted out and many lessons to be learned if we are willing to learn them. I am sure that I speak for everybody in this House and in the other House when I say that I hope the IDA will be successful in their efforts to sustain employment in the factory. But above all I would say—though indeed it is not a matter for the Dáil or Seanad or indeed for the Government but for all of us—that we cannot afford to let another Ferenka-type situation to develop.

The whole question of research and development grants has been referred to by some of the Senators. To clarify some points which were raised let me say that the proposal in the Bill is to raise from £15,000 to £50,000 the upper limits on our research and development grant subject as it was before to an overall limit of 50 per cent of approved costs. The question of the joint venture programme has been mentioned. This whole programme is not being proposed for the first time in this Bill. The programme commenced in 1973 and by the end of 1976 19 joint venture projects had been approved and these, we hope, will produce a total of 1,500 jobs at full production. The whole joint venture programme is designed to assist Irish firms who are seeking to expand through diversifications in new products, new technologies and new markets. When such a firm is identified the IDA will seek an overseas company which has matching needs and strengths and arrange for the companies to meet. The importance of infrastructure to industrial development is well recognised but the provision of moneys for these purposes is outside of the Industrial Development Act.

Mention has been made of the role of trade unions, chambers of commerce, county development officers and teams and regional development organisations. All these points will be relevant to any review which will take the place of our industrial development programme. But I would say that the county development teams, the regional development organisations, are the primary responsibility of the Minister for Economic Planning and Development.

The rationalisation by industry set up only ten years ago was mentioned by Senator Moynihan. The decision whether to give grants in such a case is entirely one for the Industrial Development Authority. However I am familiar with the particular case in the Senator's area and I think that in fairness to the firm concerned they are operating in cut-throat competition in an industry which has cut-throat competition internationally. The firm in question are generally regarded as one of the most efficient in this business in western Europe.

I should like to endorse what Senator Mulcahy had to say about the potential of the NIHE of Limerick and the colleges of technology throughout the country regarding the furthering of our industrial development. It is a point which is well taken and well made and a point which all of us as legislators and all of us as a people could be making throughout our own regions in the country. There has been a traditional bias towards classical education but this bias is gradually being broken down and the importance of the emergence of institutions such as the ones mentioned by Senator Mulcahy—the College of Technology and the NIHE—are very important in terms of the future development of industry.

There is one question which was mentioned last night and as well this morning, that is, the whole question of export sales relief. The Minister for Industry, Commerce and Energy made a detailed public statement on this matter on 21 st September last. Export sales relief as an aid is generally considered to be incompatible with the spirit of the Treaty of Rome. We have always accepted here in Ireland that at some stage it might be necessary to change the system but it was recognised in the declaration associated with protocol 30 to the Accession Treaty that if the system had to be changed it would be replaced with a system which would be equally effective as an incentive. The Government have decided that the time has now come when we must look for a new system. Apart from any other consideration, export sales relief is beginning to lose its attractiveness as an incentive for new industry because of the expiry date of 1990. A number of possible alternatives are being examined but a final decision has not been taken and in any even a change will not be made for at least two years. In the meantime those enterprises which qualified for export sales relief, or indeed which may qualify before the changeover takes place to the new system, will continue to benefit from export sales relief up to the expiry date of 1990. Those who qualify under the new system can expect to do as well and to get as much support as they would get under the present system.

The point has been made and well taken about the position of certain industries in smaller areas particularly in the west. That point was also made by Senator Lanigan a couple of minutes ago. It would be very wrong— and I think all of us would agree that it would be wrong—to give grants to people or industrialists in one area if the result is likely to be to put people out of similar employment elsewhere in the country, perhaps in the next county.

In the course of the debate a number of Senators drew attention to problems in their own areas. The special problems of the Border counties was mentioned by Senator McGowan. There is the problem of the advance factories that have been built for a number of years and have been lying idle. All of these are problems which are being looked into by the Minister, by officials in the Department and by the Industrial Development Authority. All of them are very much alive to the Industrial development needs of these areas and to the other problems mentioned. But the comments which have been made in the course of the debate have been noted and will be given due attention by both the Minister and the IDA.

Senator Jago made the point that perhaps industrialists or workers who are far removed from here might never know about this legislation. I would assure Senator Jago that the IDA will be actively promoting the enterprise development unit. That is their job and they have already been doing some preparatory work on it. Senator Lanigan was worried as to how aid might be given to merger and acquisition situations. I would reassure him that any aid to be given would be applied selectively and that each case would be considered on its own merits. This is certainly not intended to facilitate the activities of shell companies.

I have tried to cover most of the points which have been mentioned in the course of the debate. Finally I would like to say that a point was raised by the former Minister for Industry and Commerce, Senator Keating, as to whose Bill this was. This is not a question which arises at this time. We should not be worried as to who introduced the Bill. But for the records, the Bill was introduced in the Dáil before the dissolution of the last Dáil and had gone into its Second Reading, but, its Second Reading had not finished. I quote from the present Minister's speech when he introduced the Second Stage in the Dáil:

Since the proposals in the Bill have already been announced and are awaited by certain firms, and since a number of the measures were in any case long overdue from the Authority's point of view, the Government have decided to take a positive view of the merits of these proposals and to proceed with the present Bill, which incorporates the provisions of the 1976 Bill, together with a number of amendments to which I will refer later. It is my intention, however, that a more comprehensive review of the Authority's powers and functions will be undertaken at a later date.

It is not the intention of anybody to fight or bicker about who introduced the Bill or who will put it through both Houses of the Oireachtas. The important point is that the major problem facing the people and the Government and any Government agency concerned with the provision of employment or industrial development, is to provide jobs. Any extra power which the Government can give to the IDA which will help to make more jobs available for our young people must be encouraged and put through both Houses as quickly as possible. I thank the Senators who spoke for the welcome they have given this Bill.

Question put and agreed to.

Agreed to take remaining Stages today.

Bill put through Committee, reported without amendment, received for final consideration and passed.

Business suspended at 1 p.m. and resumed at 2 p.m.

Seanad Éireann debate - Thursday, 15 Dec 1977

Industrial Development Bill, 1977: Second Stage (Resumed) and Subsequent Stages.

Seanad Éireann debate -
Thursday, 15 Dec 1977