Seanad Éireann debate -
Thursday, 10 Mar 1988

Vol. 118 No. 19

B & I Line Bill, 1988: Committee and Final Stages.

Section 1 agreed to.

SECTION 2.

Question proposed: "That section 2 stand part of the Bill."

Mr. Ross

I would like to say how much I appreciate, how much, I am sure, the House appreciates, the serious way the Minister treated the debate on Second Stage and the very detailed replies he gave to our contributions and which were extremely helpful. While one may not agree with them it is refreshing because it does not always happen that one gets quite such a useful response to a Second Stage debate in this House.

There are a couple of things I would like to clarify. First, I should like to know what stage this plan is at now. We are obviously in a transition stage where the plan is about to be implemented, that is why this Bill is here but certain measures have been taken. The redundancy package is being implemented at the moment. I do not know whether we are at the stage now that we can get monthly accounts. Maybe the Minister could give us some indication about what they are showing, if we are getting that, and how the company have been doing since November-December. On top of that maybe he could tell us when the 1986 and 1987 accounts will be ready because, as he said, it has been difficult to debate this aspect without having the audited figures in front of us.

Minister for Tourism and Transport (Mr. Wilson)

With regard to the first question the redundancy package is being worked out and the monthly accounts we are getting already show that the company are on budget. I am very pleased to say that as of now. Regarding the publication of the outstanding accounts, it sounds like an evasive adverb but "shortly" is the best I can say. I genuinely believe that that will be shortly.

Mr. Ross

Could the Minister give us any indication about the criteria they will be using. I presume B & I are under permanent, almost daily, review or certainly monthly review. It appears that what will happen is that there will be a more formal review in the autumn with maybe some announcement or some public indication of where we go from here. I would like to know if the Minister could give the House any indication of the criteria which will be used for that review. Could he give the House an assurance that there will be no more subsidisation of B & I? If by the autumn B & I are not on target, if the plan has proved a disappointment, can he give the House an assurance that the Government will not come back once again and say "ah well, there are special factors", that they may say there has been a bad tourist season, that the weather has been bad or that there has been a strike or something like that." Can he assure us that he will not then say "we are off target but we will give them another chance".

This is something which worries me a great deal. There are always special factors, there are always extraordinary items in accounts like these. I would like an absolute guarantee that we will not see the Minister pouring funds once again into an unprofitable organisation which is out of target. If I cannot get that, maybe he can say what he will be looking at, as a priority, in this review in the autumn. In other words, is the commerciality of B & I the only criterion used or if the company are not commercial will the employment element be important or is it to be B & I's service to the nation as a whole, which is a very nebulous and very intangible concept, which will be important? What will be the top criteria and what criteria will be used when the Minister will have to make another decision?

Mr. Wilson

With regard to commerciality, the employment and service to the nation, all three factors will have to be taken into account. I do not want to prejudge the assessment which will take place in the autumn. What will weigh very heavily is the question of whether B & I are making a profit and will continue to make a profit. As emerged during the course of the debate there was one suggestion of a separate fund — this was mentioned by a number of Senators — a separate compartment for dealing with the debt. As the Senator knows very well, a substantial draw on the funds of the B & I is the servicing of the debt. That will have to be considered in the light of the achievement of the company under their new plan by the autumn.

Mr. Ross

If the company are off target and not making the profits which are anticipated and hoped for, will the Minister be prepared to put any more Government funds into the company?

Mr. Ferris

In view of what the Minister has just said about the financial constraints imposed on the company because of bank borrowings, could I ask Senator Ross, through the Chair, if the banks would be prepared to allow us a little leeway at the appropriate time, if that was the only reason we were not giving B & I another opportunity?

An Leas-Chathaoirleach

You mean the Minister. Senator Ross is not answerable.

Mr. Ferris

I know, but he represents the banking——

Mr. Ross

I would be happy to answer. The answer to that is certainly not. It appears that my socialist friend wants B & I to be subsidised by the banks and by the Government. This is extraordinary. We would all love that. Maybe Senator Ferris would like it, but I think it is an unrealistic request.

An Leas-Chathaoirleach

I do not know if this is the appropriate forum for that kind of a debate on the side.

Mr. Wilson

I appreciate the astuteness of Senator Ferris in recognising that Senator Ross would know more about the banks than I and addressing his question to him. Senator Ross prefaced his question with a useful little word, "if". I would be a very foolish politician, let alone a member of the Government, to answer at this stage a hypothetical question about what the financial position will be in autumn. I outlined the general principles which will guide the Government in their consideration of this matter in the autumn when it comes up for review, as both management and unions know it will, because that was stated at the time of the inauguration.

Mr. Ross

The Minister understands the point I am making. The point is that he will not rule out putting more funds into B & I in the autumn if things go wrong. That is the crucial point of the Second Stage debate.

Question put.

Mr. Ross

Vótáil.

An Leas-Chathaoirleach

As the required number of tellers have not been appointed on the Níl side of the House, I declare that the question is carried.

Mr. Ross

On a point of order, I wish to record I am dissenting from the Bill, even if nobody else in the House is.

Question put and agreed to.

Section 3 agreed to.

Title agreed to.

Bill reported without amendment and received for final consideration.

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

Mr. Ross

I will be brief. It is extraordinary that on a Bill of this sort which spells out a principle of the State funding an unprofitable company, should have such extraordinary ideological unity in the House. That is what we have seen this afternoon.

What the Minister said in his reply is very significant. He said that B & I were not alone in that they were part of an industry which was unprofitable worldwide. That is one of the problems we will have in the future and that is why it is quite extraordinary this Bill has been passed almost unanimously. If it is a worldwide phenomenon, as the Minister so rightly said, that this type of shipping industry, of freight and passenger industry in shipping, is contracting then we are a little foolish to have allowed this Bill to pass without opposition today, apart from myself.

It is the principle I am worried about. It is the principle of the State willy-nilly funding NET, Irish Steel in the past and semi-State organisations. This principle, although I commend the attitude of the Government in attacking it, has been promoted once again to a smaller extent because although the Minister did get the unions and management to knock their heads together on this particular issue, the principle is still there, that they are getting money from the Government. What we have not heard, and what I failed to get from the Minister on Committee Stage — I knew I would fail to get it, to be realistic — was an assurance that this would not happen again, not only that it would not happen again in the area of semi-State bodies, but that it would not happen again in the specific case of B & I.

What I dread, but what I anticipate, is that this plan will not work and that B & I, having contracted, will come back to the Minister. It may not be this October — maybe this plan will work for a few months — but because of the nature of the industry, because of current events and trends throughout the world, I anticipate B & I will come back to the Government and say they will cut their workforce again, as they have done before. I have lost track of the number of reports and plans which have been written about this industry which have not worked and this is just another one. They will come back to the Minister and say they will take measures similar to all the others, and once again, will ask for another £1 million, £5 million, £20 million and pay off their debt.

That is the principle which as not been attacked. The issue has been attacked in a very specific way. The industry has been thinned down but what I think we have here, unfortunately, is a failure to attack the principle of subsidising highly unprofitable organisations and closing them down. That is not meant to be a heartless declaration. I agree with the Minister that industrial relations in B & I have been extremely good, but I believe it is inherently a badly run, dying industry and should be allowed to have a peaceful burial.

An Leas-Chathaoirleach

May I remind the House at this Stage that Members may speak only on what is in the Bill, and will have one opportunity to speak.

Mr. J. O'Toole

I take a different point of view to my esteemed colleague, Senator Ross, on this issue and I want it to be clearly on the record. This Bill reflects a very pragmatic approach to the resolution of a problem and the unity of approach and support for what is in this Bill, reflects the unity of approach that exists in the company in order to resolve the problems of the company. We are not talking about an ideological solution to a problem of commerce, we are talking about a pragmatic resolution of a problem that has arisen.

In an industry which, as my colleague would say, is in trouble worldwide and is not making a profit, I would hasten to remind him, and I am sure he is well aware of the fact, that a company in that same industry is being floated publicly on the Irish Stock Market. I know enough about industry and economics to know that that kind of thing would not happen if the private sector did not feel it was a profitable and commercial operation. There is no difference between what we and the Government are attempting to do here today and what will be happening tomorrow morning in the private sector. We have taken a fairly major step forward. I compliment the Government on taking this position and would like to be recorded as having so said.

Mr. Ferris

Because Senator Ross' comments were pertinent to the Bill and to the discussion we had most of the day, I need to put on record our attitude on this matter. I think he has ignored the concept of the debate we have had on the Bill which dealt with not alone the economics but the social obligation of B & I. It is not just as narrow as looking at the balance sheet. I am quite serious when I asked him and the Minister about a hypothetical problem. If the company are still in trouble the financial institutions will have an obligation to help. They have as much an obligation to consider the national interest as anybody else, whether it be Government or workers. It is the demands by the financial institutions that have created the situation where the Government have to give further money. Perhaps the banks in the national interest, would consider a moratorium if speaking hypothetically, the company are still in difficulty. That question should be asked, as well as asking the Government if they will close the company if they do not succeed.

Minister for Tourism and Transport (Mr. Wilson)

I am glad to have an opportunity to make a couple of comments on what Senator Ross said in particular. First, he said the principle worried him. There are principles and principles, and one of the principles I would subscribe to is that I do not want to see a monopoly on the Irish Sea. If we withdraw B & I from the Irish sea, it will be a case of monopoly. I recalled during this debate that my office was inundated with calls from people who had perishable goods to export across the Irish Sea and who had no way of doing it when Sealink were on strike, a strike incidentally which broke out not on the Irish Sea but on the Channel between France and England.

The second point is that the fundamental principle on which this Bill rests is that we have asked management and union to produce a commercially viable operation. This is the objective we have set them. I have indicated to the House that we will be examining the position in the autumn and we will be taking the necessary factors into consideration at that time. While it is true that Senator Ross did not get an assurance from me that it would not happen again, he also did not get a statement from me that it would happen again.

Question put and agreed to.

An Leas-Chathaoirleach

When is it proposed to sit again?

Mr. S. Haughey

It is proposed to sit again at 12 noon on Wednesday, 16 March, 1988.