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Seanad Éireann debate -
Thursday, 30 Jun 1988

Vol. 120 No. 11

Forestry Bill, 1988: Committee Stage.

Sections 1 to 8, inclusive, agreed to.

I move amendment No. 1:

In page 7, lines 1 to 5, to delete subsection (3).

Amendment No. 1 is in the names of Labour Party Senators and of Senator Joe O'Toole. We are concerned about this section which provides that the Minister in consultation with the Minister for Finance may set up a private company without having recourse to the Houses of the Oireachtas. This is, in other words, an opening to privatisation. We have already experienced this when we set up companies like this do a specific job. When they become successful, like the most recent ones, and the moment they show a profit after being set up for the benefit of the State, the executive director suggests that the company should be up for sale to the public. When the Oireachtas in its progressiveness decides to form a private sector company, that company will still be considered by the House to have a major national responsibility, a social responsibility and an employment responsibility. We are unhappy about this provision giving the Minister this power. I am not thinking in this context of the present Minister, a man with whom I have had excellent personal relationships and discussions in this House and in the Dáil since he accepted this portfolio. I have no doubt about his commitment to forestry and to its development for the betterment of the country and of the national economy. I am concerned however that at some future date some Minister who has a hang up about privatisation would, with this section, have the power to agree to dispose of this company. It is a trend I am concerned about. This amendment, which aims to remove this subsection, would remove that possibility.

Certainly, the trade union movement is extremely concerned about it. They had hoped to have lengthy discussions with the Minister before this legislation went through the Dáil. They have had brief discussions with us. My colleagues, Senators Brian O'Shea and Jack Harte, will have further comments to make on this section. Perhaps they might want to hear the Minister's comments on the concern I have expressed.

This subsection is an enabling one. It is designed to give the company flexibility in regard to its future development. Some State-sponsored bodies have, in fact, been established as public limited companies in the first instance — for example, Aer Lingus, Aer Rianta, B & I and Comhlucht Siúicre Éireann. The Senator should take that factor into account. Any company which is established initially as a private company may, subject to the requirements of the Company Acts, re-register as a public limited company. Coillte Teoranta should have the facility to do likewise. Indeed, even if this subsection were deleted, it could do so within the parameters of existing legislation. This subsection, however, provides what may be regarded as a safeguard in that it requires Coillte Teoranta to obtain the prior approval of the Minister for Energy and the Minister for Finance should it propose to become a public limited company. Accordingly, I do not propose to accept the amendment.

As I have said, a number of companies have been established already over the years as public limited companies. The very safeguard which the Senator is anxious to put into this Bill would not have the effect he desires. It would be possible for the company to re-register as a public limited company within existing company law. We are merely putting in a safeguard to require the company to come back to the Minister for Energy and the Minister for Finance should they wish to take that course.

I take the point. Under the Companies Act it is available to a State company to privatise. The Minister is seeking to add a safeguard. I suggest to the Minister that if a further safeguard were added, whereby any such move towards privatisation would have to be approved by the Dáil, it would go some of the way towards meeting the worries we have on this section. The Minister for Energy and the Minister for Finance would be the Ministers holding the safeguard. I feel that the Houses of the Oireachtas should have at least some say if we are disposing of State assets into the private sector.

Senator O'Shea has made a suggestion which possibly the Minister should seriously consider on Report Stage. The Minister has the powers and the parliamentary draftsmen available to him. Certainly, we accept the fact that the Minister is ensuring now, by this additional subsection, that it could not happen under company law without his approval and the approval of the Minister for Finance. Surely in a democracy, because of the changing attitudes of Ministers of all parties to privatisation as against their commitment to the State sector, it would be appropriate that the Houses of the Oireachtas would have an opportunity to debate any proposal made to it by the company we are setting up if they considered it was appropriate to have the company privatised.

Extraordinarily enough, when we were discussing the Postal and Telecommunications (Services) Act, 1983, when we established An Post and An Bord Telecom, on page 37 of that Bill, No. 24, section 9 (1) the exact wording in that section was:

The Minister, after consultation with the Minister for Finance, shall cause two limited companies conforming to the conditions laid down in this Act to be formed and registered under the Companies Act.

Subsection (2) of section 9 says:

The Minister shall by order appoint a day to be the vesting day for each of the two companies as soon as practicable after the companies have been registered.

This additional third section was put into this piece of legislation. It was not put into the Postal and Telecommunications (Services) Act, 1983. Perhaps the soundings we have heard recently from one of the executive officers on one of those boards which intimated that it is appropriate now for that particular service to be sold off was because these two restrictive subsections empowered him under the Companies Act to do that. It was never the wish of the Houses of the Oireachtas that it should happen in that way. Now there is no recourse to the Houses of the Oireachtas. There is no Minister with a responsibility in that area. The only opportunity we have to debate is when we get a copy of their report and accounts lodged before the Houses of the Oireachtas which could trigger off a debate. Even then we would have to get Government time and the permission of Government to have it.

Is the Minister reassuring us that this additional provision safeguards against the concern we have in the Labour Party that any company set up like this could, under the Companies Act, make a decision to apply and be considered for privatisation without recourse to the Minister or the Oireachtas? If that is the commitment the Minister is giving, we will accept it. However, would he also take on board the suggestion of Senator O'Shea, that it would be appropriate that the Houses of the Oireachtas would be included in the consultative process and that an order would be laid before both Houses of the Oireachtas before that procedure could take place? Then, at least, the public would be aware of what we would be doing in this area and the reason why new forestry company would suddenly be privatised. The Minister understands our concern. We accept his genuine response and that this is a provision to eliminate that possibility, but could he broaden it a little more so that the democratic process would be implemented?

At the moment the position is that we have a million acres of land under forestry. While this represents quite a considerable amount, it is, in fact, the smallest percentage of forested land in Europe with the possible exception of Iceland. The vast amount of this forest, that is, 85 per cent of it, is State planted, cultivated and State owned. Fifteen per cent is privately owned. In fact, attempts to attract farmers and private landowners to invest in forests have been tried on numerous occasions and not been successful. For this reason we in the Labour Party think that the State, which has for the most part pursued a consistent planting programme and taken all the financial risks involved in planting these large forests, are the people who should retain them. Nobody who feels there is a fast buck to be made now in a shorter period than heretofore, because of the way this company is financed and structured, should be allowed to take advantage of the position. They would not take the long term risk. The Minister is talking about 25 to 30 years for the trees to mature. But, on the basis of the financial arrangements within the company, he could be talking about profits in five years' time. Consequently, because section 9 provides for the establishment of a public limited company, the temptation will be there to start talking about privatisation, despite all the work that has been done down the years by the State.

There is no doubt that this State commercial enterprise will make itself very attractive to private companies and to pension funds. The expectancy of making profits before was that it would take a long time. Banks and institutions, have been expressing interest in the forests.

Most of us would be advocates of the mixed economy. Most people see the necessity for State commercial enterprises going into competition with private enterprise, not only in the forestry areas but in other areas also. The consequence of this is that there is in the company, as it is structured at present, a great temptation to give away a lot of money that has been invested by the State down through the years. Work, effort and research have gone into this venture. Somebody with a few pounds to spare, such as the financial institutions, who do not manufacture anything and who get their money from us as well, could benefit unfairly. The little woman with the shawl and black hat is able to contribute to their output by putting a few pounds in the bank. They are there to make money on the basis of not having anything of their own except the buildings they subsequently buy and keep in their own names. These are the type of people who are going to get into something that the State has actually done. This company has a great basis for advancement. We have to congratulate the Government for bringing in this Bill. It is a very good idea. We have to agitate to see that a potentially profitable State commercial enterprise is not going to fall into the hands of a few predators who actually stand back a little, watch a company getting into difficulties and then move in before it goes down too far and gives an artificial value to its shares. We have seen it all over the place. The media have expressed that in a number of ways. Quite frankly, it would be a terrible thing for us if section 9 was left the way it is and was not appropriately amended.

The Forest and Wildlife Service has given great service to the State. They have done tremendous work over past decades in catering not only for the forest lands but also by providing a valuable crop of trees. It is a very welcome amenity which has been provided down through the years for camping trips. There is a danger in the way the section is set out. Without amendment, I feel that the opportunity is there for those people who could only be described now as predators. They had opportunities to invest in forestry down through the years but none of them took the opportunity to do so. Only 15 per cent of the land was privately held. It would be sad to think that because of the way it is financially structured somebody could move in and rip off the profits.

It is very difficult to calculate how much has gone into forestry over the years. They would not just be selling the trees. If they get into private enterprise they would be selling the land under the trees. Not only that, they would be sending a lot of the staff down the drain as well. It is inevitable that that is the way it would end up. That is the way that things develop. Naturally I am very concerned about this development. Private enterprise could get in there at a very high level and get substantial control in a very short time.

The primary purpose of the Bill appears to be to establish a commercial company and all the State forests would be transferred to it. Can you imagine the temptation that that would be to financial institutions, such as banks, if this was to be made a public liability company? We are on the eve of realising financial gains through a commercial State enterprise. We have something that has been there for 60 years. We have not made much of a success of it. The fact is that we are on the verge of making something very good through straight commercial enterprise. We should be in a position, through the State's efforts and money — and the people's money — to exploit it. This section should be amended to protect the people's money. If we do that the position would be that the people who are running the enterprise will be well capable of looking after the interests of the community. The community is very often left out of things. Here is an opportunity to keep the community in, but we are leaving it exposed to the market situation where people who would not take the risk earlier would be prepared to do so now because the risks are limited to about four or five years. They want to get in there and get a big whack out of it.

Senator Harte has put all our concerns into his contribution on this amendment. Does the Minister consider this additional subsection as a protection that is put in there to ensure that all the worries are not well founded? Was the reason he put it in, when it was not in the other Acts setting up similar enterprises, to ensure this does not happen without the Minister's approval or knowledge? May I ask the Minister whether his approval as defined in that section, "with his approval and the approval of the Minister for Finance", will be given by way of a ministerial order? If so, is it covered in section 3? Is our concern covered in section 3, because if it is not, this means the approval of the Minister in his office without recourse to anybody except the Cabinet. We feel that Senator O'Shea's suggestion that that approval would be by way of a ministerial order, which would then come before us so that we could have a debate on it, would be reasonable. We could debate the pros and cons. That is a reasonable approach to what the Minister has said to us by way of building in the safeguard which he has put in this subsection. In his explanation, and on the point made by Senator Harte, I feel we could have a compromise on this that would meet everybody's concern.

Níl a fhios agam an í seo an áit chun an cheist seo a chur nó nach ea, ach baineann sé leis an timpeallacht mar is gnách nuair a bhimse ag caint. I would like some clarification on what will happen to land bought by the company if there is a particular area which is of scientific interest. For instance, if there is a piece of important fenland, or a piece of bogland or oak wood in the middle of a particular area that has been bought by the company, what is to happen? Will that be given over to the Forest and Wildlife Service, or whatever? For instance, the Wildlife Service had to buy Clara Bog.

I think that would come up later on section 13 or 14.

I want to assure the House that this subsection is chartered for privatisation and you have a number of choices. For instance, if we had remained silent I am quite certain that there would be no proposal in relation to the fears the Senators are presently expressing. By the mere fact of putting in an additional safeguard your attention was attracted and you are seeking to delete a subsection which worsens the position for the points you are making. In your interest I am safeguarding you condoning the question of the company reregistering as a public limited company. Bearing in mind that Aer Lingus, Aer Rianta and B & I are presently existing companies in that category, the safeguards that are being provided are acceptable and in the main remove the fears which are being expressed by Senators. The request is being made to know if it would be possible to have the decision of this nature decided by order of the Dáil. We have to understand that the Government and the executive functions of the Government are separate. If we were to move into a position where every decision of this nature was to be a matter for debate in the Dáil we would be facing into a much more cluttered situation than we are in at present. The subsection is certainly much better than if we had remained silent on it. Existing State companies are silent and can, within the context of existing company law, re-register as public limited companies without recourse to the Dáil and to the Minister. We have that additional safeguard of having to consult with the Minister for Finance and Energy before any such decisions are taken. Bearing all that in mind the House can be satisfied that it is not a charter for privatisation, It is an enabling section with certain safeguards and a certain flexibility for the company.

The whole process of this amendment has now clarified for a lot of people the worries they had about this subsection. It is in the process of dialogue here in this House and a debate on it that those people outside, who have an interest because they are employed in it, can be convinced the Minister is, by this subsection, putting in a safeguard to ensure that what they were worried about cannot happen without the approval of two Ministers, which is a step forward on existing legislation which was set up with regard to Aer Lingus and others. We are now admitting that, having had the dialogue with you. Please do not remove from the democratic process because of the cluttering up of decisions by the Houses of the Oireachtas. I would not like you to feel that that would be a necessary evil. Discussions at that level, particularly if there was a proposal before the Minister or the executive arm of Government for a privatisation proposal from the new company, naturally would be in everybody's interest. Such matters should be debated. The terms of the proposed take over or of selling off would be known. You did not address the point I made. Will this approval of yours and of the Minister for Finance be made by way of an order giving your approval, or do you just write a letter saying it is a great idea and one can sell it off?

Again, you are into the business of selling off. I will not go over that again because we have limited time. Those fears are generally groundless. It will not be an order in the Dáil or by the Minister. It will be done by the normal process for approval of matters of that nature.

With regard to my earlier comment of cluttering up the Houses of the Oireachtas, everybody here and in the other House appreciates that from time to time very serious legislation can pass through the House without sufficient debate because of time constraints. Every time we put an extra load into that, however genuinely it is done, it only has the effect of limiting still further the opportunity to discuss and debate here which I welcome very much. It is in that context that I was saying it. From time to time I have been worried because the opportunity to really discuss serious matters is restricted and limited to a degree which could and should be changed. Certainly it would be worse if practically every iota of the decision making process in relation to the powers of the Ministers and the powers of the Executive were matters for debate in the Dáil and the Seanad. Bearing in mind that the Ministers are democratically elected and have to answer to the people in one way or another, I do not think we are too far removed from the realities.

In view of the Minister's comments we will withdraw this amendment, but I will be putting in an amendment for the Report Stage to extend this subsection to include the making of an order to be laid before the Houses of the Oireachtas. I must defend those who are not privileged to be appointed as Minister.

Amendment, by leave, withdrawn.
Section 9 agreed to.
Sections 10 and 11 agreed to.

I move amendment No. 2:

In page 7, subsection (1), between lines 26 and 27, to insert the following:

"(c) to acquire land, on a compulsory basis if necessary, to carry on the business of forestry,".

This is an enabling subsection. We feel that any new company which has an interest in developing forestry should have some powers vested in it so as to be able to acquire land which in their opinion and in the opinion of experts would be suitable and marginal land for forestry development. Some person may not necessarily want to surrender it or sell it. It could be in everybody's interest that particular lands would be developed as forestry lands, having regard to the amenity value of it, the tourist value, the national value, the economic value to the country and the whole concept of what we are doing in the area of forestry. I know that this is a power that is sparingly used at the moment by local authorities for the acquisition of land in the interests of the common good in order to provide houses for those who are in need of housing, or to provide for road widening in the interests of public safety. It is not without a lot of consideration that we have suggested that this company should have this power to acquire land in the overall interest. Naturally, there would be a process of appeal against the compulsory acquisition of land. There would be proceedings to be followed. There would be an arbitrator to decide on the value of it. There is no question of taking land from the people and not compensating them. That would not arise. The overall interest of the forestry business would be served usefully if this new company had these kinds of powers to compulsorily acquire some land.

We have no problem with the overall thrust of what you are trying to achieve. There are areas here and there that we have problems with but overall we do not. Regarding the compulsory acquisition of land this is an area I have had an interest in for quite some time. I remember coming across information some years ago where it transpired that Irish-based insurance companies had substantial holdings in forestry — one in Wales and another in Norway. It seemed from what information I could get at that time — and correct me if I am wrong — that the major problem was that insurance companies had great difficulty in assembling large enough land holdings which some people would sell and others would not. With this in view, I put down notice of a motion in Waterford County Council seeking that a feasibility study be conducted into whether the county council should use its compulsory purchase powers to assemble land holdings and whether these land holdings should be passed on to forestry or put up for public tender. It strikes me that this may be a weakness in what we are trying to achieve, that it may limit Coillte Teoranta from gathering together sufficiently large land holdings and what we are seeking to achieve here will in fact strengthen and speed up the process as the Minister wants to do, and in which we very much support him.

One of the problems is the amendment accepted in the other House with which I agree totally, that is the amendment which allowed the acquisition and the sale of land. I was glad, as I said in my Second Stage speech, that that was accepted by the Government at that stage. There is a knock-on effect now which we need to look at arising out of that. Not only should they be able to acquire land but they should be able to actually pinpoint the land. Let me immediately say that I would not agree with the idea of big brother, the State, coming in and buying over small-holdings and almost evicting people. That is not the idea here. At an earlier stage of the discussion, and in my Second Stage contribution I referred to the effective, economic and commercially viable use of land and I quoted an extract from the document of the UPTCS, Our Natural Heritage, where it indicated that certain soils were five times more productive than others for the growth of wood for afforestation. I put that in the context of areas of the country where the wetter climate or the type of climate is more suitable. It would seem to me that, if you got an area of the country where both those factors came together, the soil type and the climate type, this would be the best possible use of land. Also, the particular use that was being made of it at that time was not economically effective. I certainly understand that the commitment of this Government and indeed the last Government, through Europe, has been for the most economic size of holdings and use of land etc. I would not see that what I am leading with would be against the general policy of Government for the proper and effective use of land. As Senator Ferris outlined, there would, of course need to be built into this the safety nets, appeals procedure etc. Given that after due assessment, a particular area or tract of land was most suitable for afforestation and the people who owned it at that time were properly compensated, I believe that there should be an element of compulsory purchase in the authority and the discretion of the new board.

I support the point of view advanced by Senator O'Toole, because whilst I was earlier condemning the fact that the farmers and other private people did not enter into planting etc., at the same time I would have to have regard to the question of the acquisition of land. We are not dealing with an urban situation where housing is being developed. Those who are in the farming business, if they want to develop, should not be trodden on by acquisition; we were not talking about that. We think that they have every right to enter into a full discussion so long as the land would not leave the State. When we are talking to them about buying land from them or taking it, we have to talk in terms of full compensation. At the same time there is no way in which you can develop the potential of the company at the moment if you do not have the acquisition provision. What we are really concerned about is the sale and acquisition.

We are dealing with a Bill that provides a wonderful opportunity for the State in the commercial end of the industry. We are going to be in a lucrative marketing situation provided, of course, we get our act together if we look at the potential in Europe and soon. We will need to acquire land. We accept that. We do not accept that the State should ride roughshod over people and treat them unfairly. We are not talking about the acquisition of land without compensation. We want people to be properly compensated. We want them also to have an opportunity to state the reasons why the land should not be acquired and to have some sort of legal framework within which they can protect themselves. That is what we want here.

There is the question of trying to get a balance between the right of the State or company to acquire land and the interests of the people who are going to have the land taken from them. That is really the concern.

I have a slight misgiving about the compulsory acquisition of land. As you are all aware, the part of the country I come from has the proper soil type and the proper climate and indeed that kind of situation could develop. It would be a dangerous precedent to set. I have listened to Senator Harte and the previous speakers. I know they want people genuinely compensated but the principal of compulsory acquisition is a very emotive issue in forestry and I think if the compulsory acquisition of land were written into the Bill it would set a dangerous precedent.

I would be of the same opinion and I think the new section, as proposed by Senator Ferris, would be unnecessary. The important thing would be to encourage privatisation of afforestation. The problem heretofore was to compel the Government of the day to acquire land that was being offered to them and it will still be offered to them. It can be purchased and put to afforestation and that I think is sufficient.

In all debates in either House the case is made for and against. I could not accept this amendment for a variety of reasons. Let me say at the outset that I am in the process, as are the staff in my Department and indeed quite a number of people in the private sector, of building bridges over centuries of problems with regard to encouraging people to get involved in forestry. The last thing, therefore, that we would want is a scenario where any company had the power to do as Senator Harte said, to ride roughshod over the private individual, rights of farmers or other land owning groups.

I take the point that we are aiming to have large economic blocks and that should be a feature in the good management of forest development for the future. We must also have a sensible approach. First and foremost, this is a new company. Thankfully there are quite a number of other small private companies involved in forestry over recent years. If we were to extend to this company the powers of compulsory acquisition, what would the legal position be with regard to other private companies involved in forestry? We have checked this out with the Attorney General and we are absolutely satisfied that it would not be possible to enshrine in this legislation powers of compulsory acquisition without the difficulties that I have indicated to you. We have, therefore, decided that these powers will reside with the Minister for his use on a discretionary basis, depending on the situation.

Senator O'Toole referred to the question of suitable soil types and amassing them together for forestry. It is not altogether as simple as that. If you look at the soil analysis carried out by An Foras Talúntais a cursory glance will indicate to you that there is a huge number of soil types. They can be broken down into about 27 general groups and they exist in every county. The best and the worst of these exist in every county and in paractically every parish, depending on degrees. With regard to yield class, — I take the point that the Senator is interested in getting up into the high yield class — anywhere from 16 to 30 is an exceptionally good yield class but even that has a very wide variation because 16 is far above the European average and still only half of what is possible on our best land. We could not confine ourselves exclusively to our very best land so we take that variety on board.

Senators will appreciate that overall the residual powers remain in the Department for use at the discretion of the Minister. They could not be given to one particular company without incurring problems with regard to the rights of other private companies who are involved in forestry. The company has the power to purchase land. We are anxious to have the greatest co-operation possible in this area. The European Community has given a grant to a co-operative in the west, for instance, to encourage groups of farmers to come together. They could retain their best land for conventional farming and even make swops and exchanges with other farmers in order to put economic blocs of forest parcels together. That is a better way to go than, at this stage, giving the company powers and rights which would be exclusive to it, which you would be denying to other companies and which would probably create problems also. The power still resides with the Minister, for his or her use, depending on the situation.

We thank the Minister for his response. We were aware the Minister had retained the powers of compulsory acquisition of land under the amended 1946 Act. We were not doing anything different from what the Minister already has the power to do. We were concerned that tracts of land could lie unused while this new company would like to have access to them. In spite of this Government's effort and the previous Government's efforts — who gave inheritance tax incentives, income tax incentives and other financial packages to the private sector to develop private tracts of land for forestry — there has not been the kind of movement we would all wish for. There has been some movement. We are quite aware that there are tracts of land which are marginal, to say the least, and would certainly be suitable for forestry but for some reason, historic or otherwise, the owners may not necessarily want to dispose of them.

In Ireland the concept of having to give up some land is a very serious matter. Those of us in the Labour Party are more aware of this than anybody else. We find, at county council level, that it is extremely difficult at times to get the manager to use his powers under this section, even when there is a dire necessity to house somebody, particularly in an isolated area. However, it is a very important function to have, although we rarely use it, because having it gives you some powers in trying to move forward. I think all the Members here who are members of local authorities will know that we have used that power sparingly.

In case the position might be misrepresented, everybody who owns land in this country is protected under the Constitution from anybody, even the Minister. So, even if the Minister, a county council, the Land Commission or anybody else had compulsory acquisition powers these could only be used within the framework of the Constitution. People have the right to object, to have a public hearing on the case, produce witnesses and also to appeal the actual process of compensation. So, it was not some revolutionary nationalisation of land that was proposed. It was just intended to facilitate the company in the performance of what we consider a very important role, the ability to acquire land for that purpose.

Now that the Minister has admitted he has retained the powers for himself, to be used at his discretion, may we ask him when does he expect these powers to be used and will he, at the request of the company, use them? What kind of instructions will the Minister give under the powers he has retained for himself? We realise that he has the powers. Now that he has admitted this publicly, let us talk about when he intends to use them and under what circumstances he will allow them to be used. If we can get that assurance, we will be happy to withdraw our amendment because obviously the company can apply to the Minister to operate these powers if they have difficulties.

I have been thinking about the compulsory aspect of this legislation. It would be a little inconsistent with my earlier remarks, having regard to the community's rates and the community always being excluded. I agree with the general purpose of acquisition, the driving force is to acquire land to develop forestry and there is a need for that. I think I would have to stop short on the compulsory aspect in this case because of many occasions in this House I have been very hard on the community being excluded. I am talking about industry in general where the worker's rates are there, management rates are there and board rates are there but the community is very often excluded. For that reason I feel I would have to go softly on the compulsory aspect.

We would take on board the very valid point made by the Minister regarding sensitivity in this whole area. We are not suggesting that viable holdings be interfered with on the margin. There are certain basic areas where we would see compulsory acquisition as being useful and right — where tracts of land were totally neglected and a particular piece was needed for access to other land that had been acquired. The use of compulsory purchase powers can straighten out a situation very quickly where somebody is willing to sell but there are title difficulties. Is the Minister saying that where such cases come to light he would not stand back from using compulsory powers if it were in the general interest, taking sensitivities on board also?

During the course of his Second Stage speech and again this morning Senator Ferris tended to ignore what is actually happening in relation to the accelerated growth in private sector forestry development. This year we expect private afforestation to reach about 4,000 hectares. I am confident that that will be significantly increased again next year so that, if you like, private afforestation in the next year will virtually match what the State was doing a couple of years ago and that is a phenomenal increase. It is a tenfold increase in four to five years. We expect that to continue.

The advice I have in relation to this particular section from the Attorney General is that to give this provision to the private company would transgress the rules of fair trade and also EC regulations. With regard to the question as to whether or when or in what circumstances a Minister might use these powers, I think it would be fair to tell the House that they should be used very sensitively and very sparingly. In the context of Senator O'Shea's question, in a situation where an isolated block of land interferes with the mainstream development of forestry, obviously, the first stage of that would be to negotiate sensibly and on a commonsense basis with the owners to see if that land could be acquired and the use of compulsory acquisition powers should be a last resort. I have always found, and I would try to achieve this in my attempt to deal with the questions arising here, that most people in the final analysis are capable of reaching a commonsense solution if the approaches are made properly. Very often they are not, and we should ensure that we do not ride roughshod over the rights of individuals but that at the same time we can put in place, first, negotiation and in the final analysis compulsory acquisition powers where it is clear that the sensibile course of action is to go in a particular direction and that the balance of opinion is in that way. I could not possibly tell the House the specific circumstances in which I would use compulsory acquisition. It would be used very sparingly. In the context of the amount of land that is available for forestry at the present time which, as Senator Rory Kiely said in the Second Stage speech is in no way in conflict with what is happening in agriculture — it can develop in tandem with agriculture — to waste our time or the company's time or any other company's, or the Minister's time on the use of these powers willy-nilly across the country would be absurd and I do not see us travelling that road.

We are prepared to withdraw the amendment on the assurance that the Minister has the powers and is prepared to use them, albeit sparingly, which is what we would want to have done anyway. I do not think there is any area of disagreement between us.

Amendment, by leave, withdrawn.
Section 12 agreed to.
Section 13 agreed to.

I move amendment No. 3:

In page 8, subsection (1), line 21, to delete "sale and".

We felt this would read better than what is at present in the Bill. Perhaps the Minister would respond when he reads the section as suggested.

This section is naturally worrying to our people because it does appear to be a subtle attempt to undermine the whole ethos of the Bill which purports to take over the management of State forests. In effect, if this section is passed without amendment, I imagine there could be complete denuding of the State forests within five or ten years. Over the past two years or so there has been considerable speculation about the sale of mature and near-mature forests. We are very concerned about this particular section. The reference to the sale of timber is perfectly legitimate but we are wondering why the clause about the sale on land could not be explained a little better. For example, does the Minister intend to sell plots of land with unfelled trees or is it just the unfelled trees? It certainly seems that it is plots of land. The question of sale is a difficult one in this sense that if the company had the intention of selling a bit of forestry land as well as the timber on it for the purpose of acquiring an area, that is an understandable thing. It is a different matter if you no longer require something and just want to make a profit and sell it off. If the intention were otherwise and if it were possible for the State to decide that there was something bigger in the neighbourhood or somewhere else and that it would be brought into the company in a much more beneficial way, then it would be understandable to think about the question of sale but only under those circumstances.

The reference to the sale of land does bring us back once again to the issue of privatisation. I am not against profits but I am certainly a great advocate of — and I would do as much as I can to protect them — the interests of the mixed economy and therefore this is why sections like this in the Bill cause us concern. It says in the Bill that the company shall submit and agree with the Minister each year a programme for the sale of land and the sale of timber. That is the worrying part about it the point about sale. It is worrying for us in the context of banks and other financial institutions with pension funds and so on. They would not be interested in investing in marginal or unused land. This is another cause for concern. They have certainly set their sights on the State lands, especially on those forests which have been carefully cultivated perhaps over 40 years and where they could move into a tidy situation. It seems that under section 14 the company provides such bodies with the possibility of fulfilling their wishes to get in and get the benefits of what has happened over a 40-year period. There are readymade road networks, a well-run and well-managed wildlife, with habitats well looked after. Trees have been professionally trimmed and pruned and generally regularly inspected. Is it any wonder that one has heard the speculation over the last couple of years about institutions of this nature and particularly if they decide to get in on the part that has already been looked after for them. To be quite frank about it, I do not like using the term "rip-off" but if it did ever get to that point, it could only be described as a rip-off. Where people with big powers want to get their hands on something that has been in State possession through thick and thin, mostly through the thin. I would be worried if State forests are not developed. Much attention has been given to that matter.

The one encouraging aspect — I do not want this to be taken as a snide remark — is that in May 1986 a motion was put on the Order Paper in the names of the Fianna Fáil group of Senators. It called on the Government to prepare and implement a plan for the maximum exploitation of our foresty resources and for a rejection of any attempt by the Government to dispose of State forests to private banking and financial institutions. That brought a bright glimmer of hope to the situation. However, it was merely a motion on the Order Paper when another Government was in power. We are now talking about the power of the Minister here. It is not a question of mistrusting the Minister but times have changed. Emphasis on these institutions and their interest in the State forests has grown in the past couple of years. With a long term operation like forestry where there is great potential finance is needed. This is a serious matter and I would have a right to be concerned about it.

The motion Senator Harte referred to was put down because the Fianna Fáil Party were concerned that enough land was not being acquired at that time for the development of forestry. We were also concerned about the sale of land. This section has safeguards to the effect that the Minister would have to consent to the sale of land and that is very important. The section was amended in the Dáil to ensure acquisition of land. That is also very important. Every effort should be made to acquire sufficient land for the development of forestry, especially land that would be suitable for afforestation. If this amendment were accepted no land could be sold and there might be occasions where the sale of land by Coillte Teoranta to people for the development of forestry might be advantageous.

Mar a dúirt mé ar ball, is í an timpeallacht a chuireann imní ormsa agus céard a tharlós in áiteacha áirithe in a bhfuil sé leagtha amach nó pleanáilte ag daoine crainn a chur.

I was particularly concerned that certain areas of scientific interest could be planted without consultation with the Minister with responsibility for wildlife. However, I kept an eye on the Bill as it was going through the Dáil and I had made my concern known to the Minister. I would like to congratulate him and his Department for ensuring that this area of our environment will be safeguarded. I would ask the Minister what will happen to areas of scientific interest which might be a small part of a much larger area — for instance, a fen or a piece of bogland that might be surrounded by an area to be planted with trees. Will that be given over to the wildlife service?

We have had very sad examples of areas, which were actually listed by the wildlife service, being taken over by the forestry which were totally unsuitable for planting and in which the wrong trees were planted at the wrong time. These areas are now neither good for forestry nor for the particular scientific interest that was related to them at the time. They have been ruined. I would like to ask the Minister if anything can be done or if his Department will be looking after that particular aspect.

There are also areas where there are national monuments. Are they to be protected? For instance, if there is a certain area of interest where trees are to be planted, this whole area could be covered over in a very short time. I know of areas where trees are growing which are almost invisible now. Does the Minister intend taking any steps to safeguard these areas?

I would like to thank Senator de Buitléar for his comments in relation to our acceptance of an amendment in the Dáil which, as I indicated at that stage, perhaps was not fundamentally necessary because the worry and fear with regard to safeguarding areas of scientific interest were already adequately covered. To remove any shadow of doubt, I accepted an amendment in the Dáil and I thank the Senator for his comments in relation to that matter.

Small sites of scientific interest which are attached to or in large forests are, on a continual basis, the subject of discussion with the Office of Public Works. We would like, as we have done in the past, to encourage the greatest possible sensitivity and indeed the widest range of consultation with the Office of Public Works and interested groups to ensure that these resources are managed in the best possible way. We have no interest in conflict in this area. As I indicated earlier, many of these sites are unsuitable for afforestation. We will be concentrating much more on the better, richer, more high yielding sites. Where there is a problem of this nature we will deal with it in a very sensitive, open and flexible way.

I regret that I cannot accept this amendment. I want to make it clear to Senators that the primary purpose of this section is to prevent the company from selling off large tracts of land to compensate for management deficiencies in conducting their business. It is entirely reasonable that the Minister, on behalf of the citizens of the State who have invested large sums of money over the years in forestry, should have a role in preventing excessive land sales, together with the timber on the land, by the company. Here again is an instance where the absolute frankness of my officials and myself has been to our disadvantage. I am quite certain that if we had not included the sale of land, an amendment would not have been put down but we have come up front and have said exactly what we intend to do. We are doing this as a controlling measure but it also makes economic sense.

I am at present negotiating the sale of a small patch of land, the value of which for forestry purposes is about £6,000 and for an alternative purpose is about £10,000. In the interests of the taxpayers, the company and I should have the power to conduct a transaction of that kind. Opportunities like that will emerge again in the future. The reason behind the provision is to prevent the company from putting forward a plan for the sale of land which would be excessive and from covering up for their own inadequacies. Overall, the House can be quite happy that it is a good safeguard. In the Dáil The Workers' Party were worried that the actual mention of land in the context in which it is referred to, would oblige the company to sell land. We have ascertained, after further consultation with the draftsman, that that would not be the position, that clearly the company could put forward a nil sales any year if they so wished and if that was the desirable course. In other words, the Minister could not force the company to sell land.

I would like to refer back to insurance companies. I learned recently that insurance companies now hold 10.6 per cent of all deposits, a situation which has changed greatly from the beginning of the eighties. The insurance companies seem to be more interested in mature type forests rather than coming in at the bottom. Is the Minister saying that these powers would not be used to dispose of fairly mature timber to, say, an insurance company who have a majority State holding, which would be made up of moneys that would have been paid by ordinary people in this country into unit trusts? If sizeable amounts of money could be made by selling off fairly mature timber and that money could be reinvested by the company to buy, for instance, the more fertile type land which the Minister mentioned when responding to Senator de Buitléar, is this excluded under this provision?

Clearly that kind of situation is not excluded. This is a commercial company. They will put forward their programme to the Minister on the basis of commercial criteria. There may well be cases where the sale of semi-mature forests would be a consideration and I do not think we should limit the company in that regard. Last year when we proposed to dispose of some semi-mature forests there was a lot of hullabaloo about it. There were a number of reasons why that course of action was considered. First and foremost, the sheer reliance on the taxpayer to fund forestry over the years has become quite a burden. If the Forest Service could, through its own resources, increase its income by the sale of semi-mature lots, representing a tiny proportion of its total assets, and producing a satisfactory economic result, and these funds were used for extra development, the purchase of better land or whatever, that would be an eminently suitable, commercial, economic proposition for the Forest Service to be involved in.

It also has a wider dimension which is very often not understood properly. That is that there has been quite a reluctance over the years — that is changing now — on the part of the private sector to become involved. Very often pension funds and investment companies were going abroad to buy the exact same properties. It is a pity that the pensions of Irish workers, which are being invested in investment companies or insurance companies, would be used to buy properties abroad instead of repatriating them and using them here at home.

The third dimension is, of course, a much more positive one. That is that the reluctance on the part of farmers to get involved in forestry is very often because of the slow and long wait for a return. If you could project an image, having developed a market, that there are opportunities abroad to dispose of these properties at an intermediate or younger stage, many people, particularly older farmers who could see themselves realising a profit within ten, 12 or 15 years, would go ahead and make that plantation. We are in the process of creating a new market and that will take time. As I have said, we will make no sales unless we are satisfied that the price is right. That will apply to the new company but they will have the flexibility to get involved.

Finally, many of the sawmillers in Finland and other parts of Europe, in order to control a part of their raw material, are forced into the market to purchase semi-mature stands. That is a good development. Why should we always rely on the taxpayer, the Exchequer, to provide the resources for intensive afforestation? We are talking about increasing our land resources from 6 per cent which is a very low average compared to European standards. We are not going to increase that figure to the European average while we are depending on the taxpayer, and we could not expect to do so. We have to create opportunities for the private sector to become involved as much as possible, but on an economic and commercial basis for the company.

We welcome the Minister's expertise in this area. It is refreshing, to say the least, to have somebody who obviously knows his brief and is operating it effectively. We also welcome his frankness and openness although, as he has said, it has led to amendments being put down. The whole purpose of amendments, even if we do not push them to votes, is that in the actual debating procedure, information that we solicit from the Minister in response to those amendments can be reassuring to the people whom we are trying to represent to the best of our ability. The frankness of the Minister arises first of all from the fact that his group in the Seanad — Senator Kiely referred to this — showed a lack of ingenuity in acquiring land. They rejected any attempt by the then Government to dispose of State forests to private banking and financial institutions. The Minister was also against it then. For that reason, we in the Labour Party put down a motion which is on today's Order Paper —"That Seanad Éireann calls on the Government to desist from offering for sale State-owned forestry lands".

There is a section in the Bill which suggests that the company would submit to the Minister a programme for the sale and acquisition of land. We accept that by amending the wording in the other House the Minister has improved this section. At least he has accepted that the company will submit to him a programme for buying and selling land.

Senator Harte has been absolutely specific in that we have no objection to the sale of any produce of this land, whether it is mature timber or any other kind of timber that has a commercial value and that can provide an income for the company. We always felt that the State was almost negligent in its selling process and the way it offered forests for tender. It was often difficult for the people who wanted timber to be able to purchase it.

We are now concerned that in the last 12 months a Minister who has gone as far as to offer for sale publicly land that was in public ownership under the Department of Forestry is now suggesting that the company could submit a plan to him for the continuation of that process. We are concerned that, when the produce of a forest is coming to maturity and it may be in the long-term interest of the company to hold it for a further period in order to add to its value, the company could be prompted by the quick sale philosophy, that of getting money quickly, to offer forests for sale, whether to pension funds or to foreigners. Foreigners have actually bought forest lands in County Tipperary. Portions of the Galtee Mountains which were offered by a private owner and which were not bought by the Forest Service, were bought by an Englishman who then discovered that he could not work the land because the farmers had sheep on it for the last 200 years and he did not have vacant possession. He then packed up and went back to England. That man had visions of owning a mountain and doing all sorts of wonderful things with it but he forgot that occupying tenant farmers had sheep on the land, except when the snow was on the Galtee Mountains.

However we see no problem — this was spelled out by Senator Harte and Senator O'Shea — in respect to the sale of timber, standing or felled, or other produce from forest lands. Our reservation is that this new company can submit a programme to the Minister to sell all their land for some reason. Maybe the Minister is trying to be a little bit more careful in that he will now have to grant approval rather than just offer the land. Perhaps he might, in the national interest, refrain from allowing this private company to sell all the assets which the State, the taxpayer and every PAYE worker has helped to establish. This land might be of value to the State and an income to the Exchequer and we would not like any company, set up by the Houses of the Oireachtas, to dispose of it for commercial reasons.

I accept that the programme will have to come before the Minister for his approval but his performance in the past 12 months shows he has no objection to the selling of forest lands. We have no objection to the sale of forest trees but our philosophy is that the land itself could be used for further forestry development. That has been the case with most forest land. We want to ensure that because of the involvement of the public sector and the investments of a lot of capital into this area, it will not now be sold just because it is commercially viable to do so or because it may help to balance the books on a certain day. I am a bit concerned about that. We want to find out from the Minister how strict he is going to be in this regard and if all proposals that come before him will get his stamp of approval. I hope that will not be the case and that he will seriously consider the programme. As members of the Oireachtas, we should discuss this programme. That is the way forward. The Minister is just being consistent in this regard.

I have not got the time to go back over the record to sort out a few motions that I remember coming into this House which would be very embarrassing to Senators on the Opposition. If they put our motion in the context of what this Government have tried to do with regard to forestry since we were elected then they would be entirely happy that the worries which were expressed by the Fianna Fáil group at that time arose mainly because the sales as proposed were understood to be sucked directly into the Exchequer without any real promotion or extension of the forestry arm.

To come back to more fundamentals and the points made by Senator Ferris in relation to the company selling willy-nilly or wanting to sell a very considerable part of their assets, that is the precise reason this provision is included. I will not allow the company to dispose of land or timber because very often people confuse land as being the asset which is held by forestry and that is dangerous in the context of sales. They fail to realise that you can sell premature timber for harvesting into pulpwood when by waiting a few extra years it would become small saw log or large saw log.

The reason land and timber are mentioned is because the exact same problems arise with timber but are not so interpreted. The provision, therefore, is very strong. It will ensure that the company will not have the powers that Senator Ferris fears they will have. If we had remained silent on this matter Senators would not be exposing this problem. They have rightly debated the matter and now they can be satisfied that that group of Senators have tried to do for forestry what certainly was not done previously.

Amendment, by leave, withdrawn.
Question proposed: "That section 14 stand part of the Bill."

I very much sympathise and to a great extent agree with the points that have been raised on the last amendment. It is important that the new company should have the facility to dispose of property if they consider it is in their interest or in the national interest to do so. I have had the greatest difficulty with the Department in the past in an effort to have them dispose of a small piece of land to individual tenant farmers. It took four, five or six years and two or three Ministers to have the Department sell 50 yards of timber to allow the sun to shine on a farmyard down in Stradbally in County Laois. The Department of Forestry were outrageously thick and stupid about the whole matter. I hope that the new company will not plant trees within 50 yards of a holding. It sometimes happens that when an estate or a farm is acquired the boundary goes right up beside a farmyard or a home. It is a great imposition and it is against natural justice for a semi-State organisation to deprive a family of sunshine. In the winter time the frost never goes off the ground.

I want to ask the Minister if he is going to avail of this section to acquire the quarter of a million acres of cutover peat-land in the midlands — Laois, Offaly, Westmeath and parts of Kildare. It is time we had a clear indication of the Government's policy on this matter. The difficulty has arisen that Bord na Móna, in their compliance of the 1936 Act to take every bit of peat for sale that they could possible lay their machines on, have left a very shallow amount of peat over the marl. A considerable acreage of those cutover bogs will not be able to support mature timber. What are the Minister's plans for that area? Is he going to endeavour to plant some of those large cutover areas for the production of Christmas trees which would not need a very deep soil or peat structure? That is a matter that concerns me.

The Minister present is the Minister of State at the Department of Energy. Both Bord na Móna and the ESB have been the two significant industrial employers in the constituency of Laois-Offaly but Bord na Móna are now winding down. They are endeavouring to have the workers accept enhanced redundancy payments. The ESB policy is to discontinue the inclusion of the peat power stations in their national grid. That means that about 5,000 industrial jobs will be lost to the midlands. I want to know what the Minister with responsibility for energy and the new semi-State organisation intend to do with that area? Is it going to be used for intensive forestry and, if so, what type of forestry? What consideration have the Department given to this rather vexed question? It has been put on the long finger, and the problem is growing by the month. I have known our colleague, the Minister of State, for a long time and I concede that there is no man better qualified to take a decision on this important and difficult subject. We have an opportunity now to write into the Bill the thoughts and the projections. There are thousands of farmers in the midland counties whose lands adjoin cutover bogs. Some weeks ago we had right across the country Harmattan deposits which blew up from the Sahara Desert. If the huge track of cutover bogs in the midlands are left untreated we will find that we are going to have our own Irish Harmattan of peat moss or dust blowing right across the country. I hope I have not taken the Minister unawares, but I should like to ask him to give some indication of what the Government's plans are for this 250,000 acres of land.

I should like to reject out of hand the assertion that the officials in my Department are thick and stupid, even though that allegation emanated from the very learned and much travelled Senator from Laois-Offaly. The position with regard to the acquisition or sale of lands was often times difficult but it was based on a fairly sound principle. Senator McDonald, in all his travels, will be aware that very often the public saw the Government, or a Government arm, as being something which should either concede something for half nothing or always be in a position to accommodate. If we were to try to get into that position and satisfy the demands of farmers and groups throughout the country with regard to what they wanted, we certainly could not organise a forestry policy. Over time a fairly strict regime developed but we have softened that in recent times to meet more realistic trends and allowed advisable sales to take place to the public. We will continue down that road.

With regard to the Bord na Móna policy, as the Senator knows, we acquired in 1987, following a Government decision, 1,000 hectares from Bord na Móna for afforestation purposes. Those lands were acquired in Laois, Offaly, Galway and Donegal. The decision of the Government was based on the experience of forestry, mainly in research carried out in Clonsast on the development of spruces on bogland, particularly bogland which had a residue of at least half a metre of turf. I agree with the Senator that not all of the land that has been cut over by Bord na Móna contains that element and, therefore, not all of it is suitable for afforestation. There are different views as to the percentages. Bord na Móna have about 80,000 hectares, or 250,000 acres, as the Senator says, and it is estimated that somewhere between 30 per cent and 50 to 60 per cent of that land could be suitable for forestry. It will take a lot of time and discussion between Bord na Móna and the Forest Service to establish the true position there.

It will be many years before that land becomes available and, therefore, it would be impossible to take a decision in advance of the turf being cut by Bord na Móna. I have undertaken to meet with the chief executive and the chairman. I have visited Bord na Móna with a view to establishing a proper basis on which this land can be transferred to the Forest Service where it is suitable and we intend to continue on that road.

I want to emphasise to the Senator that considerable portions of that land will revert to wetland habitats and agriculture. There may, indeed, be new developments for it also. It is not envisaged, as seemed to be indicated in the Senator's question, that the Forestry Service will be taking over all of the cutaway bog. Considerable tracts of it are unsuitable for forestry and we are only interested in those tracts of land that are. We will set up the mechanisms and establish the proper consultative processes so that the relationship between Bord na Móna and the Forest Service will be on a business like basis. The problems facing both will be adequately considered. All in all, the programme, for the time being at least, is miniscule compared to the amount of land available to Bord na Móna, but that will not become available for some time. In the meantime we will further research the proper utility and the maximum use for that land, bearing in mind the employment problems that are facing Laois-Offaly as those bogs are cut away. Members will be aware that the Minister for Energy has set up a consultative group which will report to him before the end of the year on developments for Bord na Móna and setting out their programme for future years.

I should like to thank the Minister for his reply. I apologise if the Minister understood me to say that I was attributing the words I uttered to the personnel of his Department. I am talking about the body corporate. It is very hard to get through either the Department or the previous Department. It is not possible to say that, looking at the assistance the Minister has with him today.

On a serious note, the Department and Bord na Móna have at their disposal 27 years of research into afforestation on cutover bogs. It was meticulously carried out in Lullymore, which is adjacent to Clonsast. The Department may have purchased 2,000 hectares but 5,000 acres have been idle for the last ten or 15 years in the Clonsast region alone. I am talking about a package of 250,000 acres of land that should be dealt with. It should be parcelled out to the farmers from whom it was acquired compulsorily at half-a-crown an acre. It is nonsense to leave all this waste territory lying there. We have absolutely no policy and we should have one. I am very glad the Minister for Energy has a task force sitting on this because we need a policy to decide exactly what we are going to do. I look forward to a report of the task force being made available to the House.

Question put and agreed to.

Amendments Nos. 4 and 5 are related and will be discussed together.

I move amendment No. 4:

In page 8, subsection (2) (a), lines 38 and 39, to delete "not more than 9", and substitute "at least 12".

If we look at the section, between lines 38 and 39, we will see we are talking about the numbers of directors who will be involved in the company. In our amendment we are suggesting that the number should be changed to at least 12 to give the Minister, and indeed the new company, the opportunity of having the kind of expertise available to it that we feel it needs. We are suggesting a figure the Minister might consider as being more appropriate.

I agree with the amendments. Section 15 is causing problems for us, because obviously it deals with the articles of association. We notice that the Minister has not made provision for worker directors on the board. This is disconcerting to us in the light of the publication of the Worker Participation (State Enterprises) Bill. I do not know whether it has gone through the other House. In that Bill the Minister for Labour has made arrangements for An Post and Bord Telecom. He has also dealt with the question of worker directors in Bord na Móna. The Bill we are dealing with is, to some extent, related in one way or another. The need to extend the concept should be brought to the attention of the Minister for Labour. We hope the Minister will do that when the Bill is going through the House.

The concept of worker participation is a very interesting one. We are always worried about the number of man-days lost through strikes as we are always worried about industrial relations vis-a-vis other member states. Yet, when we get an opportunity to set up the machinery to allow us to do that, to take the bull by the horns and appoint worker directors to all State commercial companies we do not take it. The Minister will agree that what is important beyond all other considerations is the attitude of the parties in industry. We have to decide if we want harmony. We do not want antagonism or hostility. Very often, because people are not in a position to get the right information or to be briefed in a proper way, a lot of unnecessary conflict arises.

It is in the interests of all that there should be an extension of this concept to this board. I do not think it matters what policies or methods a Government follow in regard to production. It does not matter how well founded are their economic policies or social developments. They will be insecure if the relationship between the parties in industry are not satisfactory. The best way to remove fear and to have faith, if we are talking about involving workers is to have their representatives at the highest level possible so that they can get first-hand information and make a contribution based on their knowledge of the position on the factory floor. There may be an absence of expertise from the floor and is essential that the views of workers are heard.

All industrial relations are interwoven with community activities. Therefore, it is important that other members of the community from another walk of life should be appointed to this board to join the people appointed by the Minister. When it comes down to the question of attitudes, the whole matter of adjustment is involved. If there are workers' representatives at board level, then the whole question of adjustment can become that bit more realistic. The trade unions will have to agree to the procedures but the important point is the question of the attitudes of the board members to each other following the inclusion of workers' representatives at the highest possible level. They will bring their own expertise to the board and will get the proper information and transmit it accurately.

Down the years there has been talk about co-ordination of functions with regard to the question of workers or management boards. If we keep workers separated from this level of representation it will affect co-operation later. What we are seeking is co-operation by the parties to industry. It is nothing more than what human intelligence can stand to say that the worker should be represented at sub-board level. In this day and age when we have much more enlightened workers on the factory floor than ever before they should not get representation at that level. Since they are part of the community it is only common justice that they should get this representation at board level. The machinery is in position. I do not know if the Bill has gone through the Dáil but, certainly, it was passed by the Seanad. I cannot see why there would be any opposition to it.

A lot of complex problems will develop. Where human effort is involved many complicated problems can develop. As industry develops many complex problems arise. It is because such difficulties can arise that there should be co-operation and co-ordination of effort. Inevitably, there is a danger that such a process will fail and that the production will be inhibited or confused. It is a matter that should be given serious consideration by the Minister.

This is a question of a social service. The people appointed to the board, or who find themselves on the board through means other than the worker participation scheme should realise that they are there to perform a social service. I admit that it is a social service of the highest order. I will be the first to say that the people appointed will be quite capable people, the best that can be got. There is no doubt about that. In the long run, no matter who they are, no matter what degrees they hold, or that type of scientific methods they pursue to advance their careers, the fellow who has gone through the school of life on the factory floor, who mingles with his workmates at different levels, is the guy who will be able to pass on the proper information to the board members. He can, in fact, bring about greater co-operation and greater effort. We are in the business of trying to make a success of this. I do not think that the organisation in itself is a guarantee of success. It has got to have the right people to help it succeed. If there are representatives of the workers on the board I have a feeling they will make a good contribution. It is wrong not to have the concept of worker directors embodied in this Bill. We cannot hope for success simply by establishing the new company. We have got to work at it. Workers have to be asked to play their role and so on. Unless the proper attitude is adopted by all parties the right results will not be obtained.

We have an expert on industrial relations with us, a Senator who has written on the topic. I am referring to Senator Hillery. If Senator Hillery, or anyone else, considered the question of worker directors, would he take time to think about the concept that is in existence in Telecom Éireann, Bord na Móna and so on? He would have to say that the whole idea should develop in that direction. If it does develop in that direction we will have a better opportunity to get the mutual confidence and constructive goodwill that is needed. I hope that the Minister can come to terms with the question of appointing worker directors. I have no doubt that all aspects of industry must have this co-operation and co-ordination. The best way of getting the interweaving of human relations going is to give everyone equal representation at the right levels. The case has been made over the past 20 years or so that the appointment of worker directors is the way. We have had the Act dealing with worker participation in State enterprise and we have had the Minister appointing sub-boards.

I do not want to interrupt the Senator but most of what he has said is more relevant to the section. He was doing so well I did not like to interrupt him.

I was dealing with amendments Nos. 4 and 5. I did not intend to talk about the section.

I should like to point out that in any legislation introduced setting up boards or authorities I have yet to see the suggested number mentioned. I am not in favour of big numbers on committees. If the Minister proposed that there should be 12 members I am sure we would have an amendment to the effect that we should have 15. In my view nine are sufficient. Those who have any fears about this provision can depend on the Minister to appoint members who will be fair and have the necessary expertise.

It is not a question of numbers. It is a question of who makes up those numbers. If they can agree to a figure of nine worker directors the problem is solved.

I appreciate that.

I will address the first amendment. I want to get the concept of numbers right. I want the Minister to facilitate us by ensuring that worker directors are appointed. We will try to facilitate the Minister by increasing the number if by doing that he can meet our requirement on worker directors. We have no desire to increase numbers for the sake of increasing them.

The Minister has said the Senator is only trying to be helpful.

Absolutely. We want, if at all possible, as is mentioned in amendment No. 5, a procedure to be followed about the appointment of worker directors. There is no provision in the Bill for worker directors in this new company. We have two ways of addressing the problem. We either agree to this amendment which will make it obligatory on the company to appoint worker directors as has been done in other companies set up by the State, or we should ask the Minister to request the Minister for Labour to designate this company in accordance with the Worker Participation (State Enterprises) Act, 1988.

That is the only other way forward. Either we accept the amendment or the Minister should designate the company to the Minister for Labour who gave us a commitment when debating that legislation that we could designate companies at that time or wait until they were formed. Unfortunately, we fell into that trap in regard to Teagasc. We were given a commitment by the Minister for Labour but the Minister's colleague from North Tipperary, the Minister for Agriculture and Food, refused to accept an amendment to include them in the legislation. We are now being very cautious about legislation that sets up companies like this if the Minister does not follow through the process or the philosophy espoused by Senator Harte. In any company which has a board or a sub-board structure workers play, can play and have played a major role in the development of that company. That is what we mean in the two amendments. Will the Minister respond positively to the two suggestions and ignore Senator Kiely's remark about numbers. I do not think it was relevant.

I favour the concept of worker participation and participative structures. Employees are key stake-holders in companies. Echoing what Senator Harte has said, they have a lot of information and expertise which should be employed for the betterment of companies. Senator Harte mentioned that board membership was probably the place to start. I do not necessarily share that view, while I strongly favour the concept of worker participation. If one goes back to the 1977 Act one will see that worker directors were provided to give a legislative impetus to worker participation structures. That was 11 years ago and a lot of progress has been made since. As I recall it, the Minister for Labour of the day was concerned that so little was happening in terms of participation that it was necessary to start somewhere on the legislative side. Having said that, it has become very evident through the experience of the last 11 years that one of the real deficiencies of the worker starting at the top is that the infrastructure or sub-board structures have been inadequate to support starting at board level.

I strongly favour, therefore, the development of participative methods, first below board level, jointly between employee representatives and management so that they can work out, as they can do under the Worker Participation (State Enterprises) Act, 1988, participative structures jointly suited to the individual company concerned and, therefore, have the flexibility that goes with that. While obviously favouring the concept of board membership it is preferable, especially in the case of a new body like this, to start below board level and to jointly work out participative structures suited to the individual needs of this company.

Progress reported; Committee to sit again.