Seanad Éireann debate -
Thursday, 24 Mar 1988

Vol. 119 No. 3

Adjournment Matter. - IDA Land Bank.

Mr. J. Daly

Thank you, a Leas-Chathaoirligh, for taking this motion. I am glad the Minister who so ably dealt with the last Bill is here to deal with this matter. I hope at the end of the case I am about to make he will treat it as favourably as he did the motion.

I raise the matter of the proposed selling off of the State land, the IDA land bank, by direction of the Government. Every person I have discussed this matter with was saddened that a new Government policy of no hope in the future and no faith that this country can ever provide gainful employment for the youth of this island is now being implemented by this Government in line with the record economic retraction and shrinkage in every other area of economic activity which has felt the brunt of reduced input and expenditure. Without hope, life loses all sense and meaning.

The most startling aspect of this Government's policies over the past year has been the policy decision to sell off the industrial infrastructure which was acquired by the IDA with considerable aid from the regional fund of the EC. How can this cost saving by the Government be reconciled with the fact that 50 per cent of the cost of assembling this crucial infrastructural amenity was paid for by the EC?

We have, for example, a prime natural and national resource in the Shannon Estuary, offering the potential for major manufacturing industry. It was a sign of the determination of a previous Government that the IDA built up a land bank of 600 acres to enable our country to facilitate even the largest multinational company who might consider establishing in Ireland. The previous Administration had prepared their own Single Estuarial Authority Bill for the Shannon Estuary in order to promote its development. When there was a change of Government, that Bill died. I understand the Government are at the moment preparing their own Bill. It would not be reasonable to think that they would dispose of this land bank before the Bill is passed. Selling off this land bank when the value of land has gone down so much, and seeing that land was bought in the first instance when it was at its highest price, would be a recipe for bankruptcy.

I would now like to welcome the Minister, Deputy Albert Reynolds. I know he has a soft spot for north Kerry. He works through the recess and reserves his holidays for the Listowel race week every year. He knows as much about north Kerry and the Shannon estuary as I do and I will not bore him with details of what he knows already. However, I would like to say a few things for the benefit of the House. The Minister will probably tell me that the Bill dealing with the Shannon estuary will not be too long delayed. For that reason, if for no other reason, it would not be reasonable to think of disposing of this land. To sell it at a time when prices are at their lowest and having bought it when land was at its highest price would be a recipe for bankruptcy.

In the Leas-Chathaoirleach's constituency of Laois-Offaly land is to be sold as well. I appreciate the financial difficulties of the IDA. They are not alone in that boat. Everybody in business is having a tough time with cash flow at the present time but that does not mean they should go and sell the silver. This is not the time to do it. This land bank was identified as being the best site of the estuary. We can refer to the report of An Foras Forbartha, 1987. There was a further report showing the water depth capable of takng vessels up to 400,000 tonnes with a depth of 25 metres of water offshore. In a further report of 1984 it was pointed out that if the entrance to the estuary was dredged at a cost of £5 million ships of over 400,000 tonnes could come in. Planning application for a smelter was applied for at that time. A planning application for an oil refinery was examined at considerable expense by the Kerry County Council. Information collected——

An Leas-Chathaoirleach

The Chair would be obliged if the Senator would deal with the question from a national point of view. We are discussing the proposed selling of the IDA land banks by direction of Government policy. The Senator might keep to the wider Government policy and not dwell fully on local areas.

Mr. J. Daly

With respect, you are getting 20 acres taken away from you in your own constituency. The whole point of my argument is that Tarbert and Ballylongford are the only industrial sites in the Republic adjacent to the exceptional facility of the deep water of the Shannon Estuary. Those sites would be suitable for large heavy industry like a smelter, as the late George Colley envisaged when this land was purchased. Also envisaged at that time was the plant in Moneypoint. The plant at Moneypoint was provided with a large capacity to cater for industry on either side. It will go from Kerry to Limerick, and into Clare. As this sale is going to take place throughout the whole Twenty-six Counties, if you give me the time, a Leas-Chathaoirligh and if the Minister is prepared to sit and listen, I will deal with it on a national basis. Have the Government abandoned all hope of ever attracting heavy industry to this country in the future? Without hope, life loses all sense and meaning.

The importance of having a land bank available for interested parties gives us a lead start over countries like Scotland, Wales and Spain, who have very attractive incentives available for industrialists. The recent Electricity (Supply Amendment) Bill will give Government authority to Moneypoint to import coal for wholesale purposes. This should create a further interest in the estuary among shipping interests.

The IDA grants given to people for setting up in industry were very valuable and were responsible for many industries, some of which could not have been set up without the grants. If the IDA had given grants to people who, having got the grants did not develop and then offered for sale the sites which they bought and for which they were grant-aided, what would be the reaction of the Government? Naturally, they would say that this is not on. There is no game that two cannot play.

I will conclude by saying that nobody in my native kingdom of Kerry has the aspirations of a monarch, yet most of us realise how we should be ruled. That reality has been awakened in our minds by a Government decision which, if carried out, could destroy the hopes and the visions of our youth for ever more.

Minister for Industry and Commerce (Mr. A. Reynolds)

The Government, immediately on their return to office last March, recognised the enormity of the task they faced in restoring a sense of confidence and optimism to the Irish economy after a prolonged period of recession. They set about their task with vigour and enthusiasm and tackled wholeheartedly the single greatest deterrent to economic progress, the national debt.

Because of the quick and decisive action taken by the Government in their budgetary policy the economic climate and outlook are now much improved. There is a new sense of optimism and confidence in the economy, so much so that business investment confidence has been restored. This is evidenced by the fact that investment in manufacturing industry in 1987 increased by 5 per cent compared to an almost total lack of growth in recent years. This change came about as a result of renewed confidence in the economy following the Government's decisive leadership which saw the following: a reduction of 5 percentage points in interest rates; a reversal of the damaging outflow of funds from the economy; inflation at below 3 per cent for the year, the best performance for over 20 years; industrial exports breaking all records with growth at 14 per cent in 1987 over the corresponding figure in 1986 leading to total exports for the year of £10.7 billion and an unsurpassed trade surplus of £1.5 billion; output in manufacturing industry increased by just over 10 per cent or three times the rate of growth in the previous two years with industrial production rising by 13 per cent over 1986.

Comparing that with what Senator Daly said, whom I was delighted to hear speak about his native Kerry, would not lead anybody to believe that there is any sense of hopelessness for this country or for anybody in it.

The most fundamental concern which the Government had in implementing their economic policy was to ensure that all sectors should contribute their fair share to the process of national recovery, either through direct developmental programmes or through maintaining the quality and efficiency of services with reduced expenditure allocations. In line with the sacrifice that has to be borne throughout the public sector, the Industrial Development Authority, must make do with less funding while continuing to discharge their responsibilities in an effective and efficient manner.

At the end of December 1987 the IDA had two million square feet of vacant advance factory space and 5,700 acres of land at various locations around the country. The Government took the view that some of this space was superfluous to our industrial development needs and that it could be disposed of without any adverse effect on industrial development while making a positive contribution to the Exchequer's finances. In any analysis of that type of decision would any business man with assets of that size have them laying idle for so many years? The land that Senator Daly referred to was brought in 1973, the first 100 acres. That is 15 years ago. The next portion was bought ten years ago. Nothing has happened down there within the period but the land does not go away. The land still stays in County Kerry. The water does not change and the Shannon Estuary does not change. That Bill will be coming along very shortly.

Let me make it quite clear that unless every sector is seen to contribute its fair share in the process of national recovery, we cannot hope to maintain the consensus that prevails at present in relation to the Programme for National Recovery. It is in this context that the IDA's programmes in support of industrial development are being streamlined with greater selectivity in the type of projects assisted and with more emphasis being placed on performance-related conditions to grant payments and a greater use of repayable form of assistance. All these measures are aimed at securing better value for the taxpayers' money and at a lower overall cost while achieving the targets set in the Programme for National Recovery.

In relation to the sale of IDA land and buildings, the Industrial Development Authority have advised me that they have completed plans for the rationalisation of their property portfolio, on an evenly balanced basis nationwide, in line with the Government's direction that they should raise £5 million towards Exchequer financing in 1988.

The first phase of the programme will involve the sale, after public advertising, of 19 sites totalling 1,622 acres of land and five factories with a total square footage of 73,850 sq feet. The factories and sites have been carefully selected by the IDA on a regional basis and all IDA regions have been included in the first phase, including my own. I should stress that it was the IDA and not the Government who identified the sites and factories to be sold.

The sites were selected on the basis that there had been no major expenditure on services such as roads, water, sewerage or electricity connections. Some of the sites are part of larger developments which are not now required by the IDA or are residual portions unsuitable for further development.

Sites, both developed and undeveloped, are being maintained by the IDA in each of the regions to promote the establishment of new industrial enterprises as outlined in the Programme for National Recovery. The undeveloped sites being retained can be developed at more reasonable rates for the taxpayer-Exchequer than the sites being sold.

The IDA have actively promoted the factories now selected for sale at both regional and international level without success. These factories will represent an opportunity for the local business community and entrepreneurs to establish new enterprise and create jobs for the local communities. Many times in the past advance factories were being sought by people in the distribution trade for storage, distribution or whatever, could not be disposed of under legislation by the IDA. This does give an opportunity for that type of development to take place. The factories concerned are over five years old and have never been occupied.

Arrangements regarding the appointments of local auctioneering firms are now at the final stages and these firms will act on behalf of the IDA to dispose of the property by public auction, public tender or private treaty as appropriate. This will result in the best price being obtained for the land and factories at this phase of the programme.

After the disposal of the first phase of land and buildings the sale of further lands and factories will take place with the same criteria on a nationwide basis.

The IDA will continue to actively promote their remaining land and buildings in favour of the establishment of new manufacturing industries and internationally traded services in order to secure the creation of approximately 37,000 first time jobs over the three year period of the Programme for National Recovery.

In relation to the Kerry situation, I understand that a balance of over 100 acres, which is the equivalent of what was required in the first instance, is being kept. It is the land beside the river, but I would stress again that I am debarred by legislation from getting involved or making any directives, good bad or indifferent, in relation to the day-to-day activities of the IDA.

Mr. J. Daly

I would like to ask the Minister, whether until his new estuarial Bill is debated and comes into force, he would put a stop on the sale of the land in the Shannon estuary? I know there are 100 acres there. I know that is being kept out of 605 acres. There is no equivalent to the 500 acres in the country. The Minister knows that. I can see speculators coming in and buying this at a public auction. I presume there will be no reserve.

An Leas-Chathaoirleach

The Chair would prefer a question, Senator.

Mr. J. Daly

I am asking a question. Will this land be sold with no reserve? If the land is sold with no reserve, speculators can come in, they can buy this land and sell it for ten times the price in the future.

Mr. A. Reynolds

I have not said there will be no reserve. The disposal is a matter of day-to-day operations for the IDA. I am sure the Senator knows quite well and appreciates that I do not have the authority or power in legislation to direct the stop of any particular sale. The IDA are aware of the esturial Bill coming up. I am not in a position to say what reserve or otherwise would be put on it, but I would doubt very much if a site like that would be given away for half nothing as some people might suggest.

The Seanad adjourned at 4.30 p.m. until 10.30 a.m. on Friday, 25 March 1988.