I have notice from Senators Tom Raftery and Liam Cosgrave that on the motion for the Adjournment of the House today they propose to raise the following matter: in view of the damage being caused to the economy both locally and nationally by the dispute at Waterford Glass, the need for the Minister for Labour to make every effort to resolve the dispute. I understand the Senators intend to share their time.
Adjournment Matter. - Waterford Glass Dispute.
An Leas-Chathaoirleach
First, may I compliment the Minister on his efforts to get agreement in this unhappy dispute. I am sorry to see this dispute in Waterford, a city and a people for which I have a great affection. Not only was it part of my constituency when I was an MEP but, more importantly, it was a city in which I began my career. Even though my stay in Waterford was brief, I enjoyed my time there. I am very happy, therefore, to see that both sides are at last talking and nothing should be said in this House, or outside, which might endanger the outcome of those talks.
We have few enough products, God knows, that enjoy an international reputation. Waterford Glass has been the jewel in our crown, known and admired by people who do not even know that Ireland is a country or that Waterford is a city. To the Waterford region it means 2,300 jobs directly in Waterford Glass and almost 7,000 jobs indirectly. Waterford Glass workers have a payroll in excess of £54 million per annum and contribute about £22 million to the Exchequer. To the balance of payments Waterford Glass contribute almost £100 million annually. It is the single biggest tourist attraction in the south-east, attracting more than 100,000 visitors annually to Waterford.
The present troubles arise from trading losses which simply could not be sustained. Over a three-year period the company lost in excess of £60 million and for the year ending December, 1989, the losses were in excess of £21 million. Let us be quite clear that the present problems are the result of bad management over a long period of time and bad habits acquired by a workforce during better times. That bad management includes, particularly, allowing wage costs to rise much faster than inflation until labour costs amounted to more than 70 per cent of total costs. The market could not possibly absorb the price increases necesary to offset such labour cost increases.
Waterford workers have been know for a long time to be the highest paid workers in the land. They are also, of course, among the most skilled people in the land. The management proposals do not, let me repeat do not, envisage cuts in wages, only cuts in bonuses. The proposals would still leave them the highest paid workers in Ireland. The cuts proposed are in bonus payments. Let me point out that these bonus payments were originally brought in solely at the discretion of management to be paid only, of course, if the industry could afford them. Quite clearly the time has long since gone when the industry can afford them and it must be patently clear to everybody now that we can have these jobs only if we are realistic about the market. The market situation, quite clearly, is that we cannot sell our glass at a price which we would have to charge to pay the level of wages and salaries which Waterford Glass have been paying in recent years.
I sincerely hope that common sense will prevail. I again thank the Minister for his intervention and I hope that the outcome will be satisfactory for Waterford, for the workers, the region and the country as a whole.
At the outset I intend to enable Senator Dan Neville, who has a special interest in the industrial relations area, and also the Waterford Senator, Martin Cullen, a certain amount of my time. I seek the guidance of the Chair on this.
An Leas-Chathaoirleach
Is that agreed? Agreed. What is the arrangement for the proposed sharing of time between the three speakers?
Three minutes for each of the Senators. First, I would like to welcome the Minister to the House and as my party's labour spokesman in the Seanad, I raised this matter some weeks ago. I am glad to be able to contribute to this debate. As my colleague, Senator Raftery, said I do not think anyone would wish to say anything which would in any way affect the talks that are proceeding. I welcome the fact that talks have commenced and wish all those involved, both management, workers and officials of the Labour Court, success. What we want to see is a happy outcome and an end to this dispute.
We are aware of the problems which have evolved in recent weeks and of the possible horrendous consequences if they take their full course. The action of politicians, civic leaders and those in public and commercial life, particularly in Waterford, in helping to bring about talks must be welcomed. We are all only too well aware of the tremendous contribution that Waterford Glass has made to the economy and to the country. The tremendous history behind that industry will encourage those involved in the discussions to arrive at a proper, just and, hopefully, lasting solution acceptable to all. We are aware of the thousands of jobs that could be at risk, and of the thousands of people who depend on Waterford Glass. We are all aware of the tremendous success of Waterford Glass throughout the world and we all wish that success to continue. Obviously, changes have to take place. Work practices and methods of production will change with the introduction of new technology but, at the end of the day, what we want to see is a product representing Waterford and Ireland.
I would like to compliment the Minister for Labour who has skilfully kept at this difficult task and brought the parties to the stage at least where they are talking. At times we are critical of Ministers, and others, and it is important to place on record our support for his initiative. The Minister has the support of all Members for any action he takes. Democracy here has been founded on secret ballots and elections and that being the case there should be a secret ballot in this dispute. I do not want to pre-empt or put any markers down as to what should or should not take place. We all want to see a just and lasting solution to the difficulties which have evolved so that Waterford can continue to grow and benefit the country and our economy.
I would like to compliment the Minister and those who worked diligently in recent weeks. Some weeks ago when we first raised this issue things were looking fairly black. I would like to accommodate my two colleagues and allow them contribute a few words. I wish the Minister well in his deliberations.
At the outset I want to thank my colleagues for allowing me to speak on this very important matter. There is only one clear message I would like to give tonight: now that talks are under way, I am not going to pre-empt those talks or try to dictate what should or should not be discussed at them. The efforts over the last number of weeks have been very painful, very complicated and very difficult but, happily, talks are now under way. While those talks will be extremely difficult, the one clear message from the workforce in Waterford Glass, with whom I have spent days and nights talking in the past number of weeks, is the importance of securing the long-term future of that company. That is their objective, and, to me, that puts a very definite responsibility both on management and the unions. They both know short-term answers will not suffice. Now they want to sit down, they want breathing space, they want to get down to what they should be talking about with everything on the table. That is a matter for the negotiating teams on either side to discuss. Our wish for all of them is that they secure the long-term future of the company.
I would like to pay a most sincere compliment to the Minister for Labour. It is not because I stand on this side of the House, but I know from practical experience the enormous amount of time, day and night, and weekends, he gave to this issue. He handled it in a skilful way. His briefings were outstanding. That can never be seen by the public and, indeed, it is hard to acknowledge it. I would like to put that on record tonight. The Minister's co-operation with me was quite beyond what one would expect of a Minister. He understood the gravity of the case and nobody has worked harder in this very difficult situation.
I am an optimist by nature and I believe we should stand back a little and let the people involved secure the future of the company. It is the people in the company, on the factory floor and up to senior management, who have the ability to secure the long-term future of the company. It is vital for them, for my city, my county and for the national interest that that should happen. I wish that process very well. I urge caution on those who may want to contribute to the debate. They should stand back and give those involved breathing space to tackle the issues. I wish the talks well.
I, too, would like to welcome the Minister to the Chamber and to wish the talks well. It is great to see talks under way. The negotiating parameters have been set. Industrial relations is the art of compromise and we look forward to the successful conclusion of the talks. I would like to ask both sides in the negotiations to recognise the classic industrial relations situation they are in. As some of my colleagues have already stated, in all companies wages and conditions of employment improved during the sixties and seventies. That was the natural development at that time and it happened in Waterford. Subsequent to that, changes accrued in the labour market and competitors came in with different conditions of employment. That put pressure on the company who had conditions and costs at a much higher level than their competitors. That meant two things; either the firms in the area would have to adjust their costs, or else they would go out of business.
Both sides must recognise that the workforce will, as far as possible, do everything to protect their conditions. That is the nature of things. To do anything else would be unrealistic. They must recognise also that the management require an extensive cost-cutting exercise to keep themselves competitive. If they are to stay in the market they must get their costs right. Not to do so means that the company will not be competitive and will continue to suffer losses with inevitable closure. We have seen time and again that the companies who adjust their costs can survive. I cite Guinness as one of those. The companies who did not adjust their costs — and I know many of them — did not survive. The failure was blamed on unions and on management but it had to do with the failure to recognise the situation that developed in the late eighties. We have had changes in competition and changes in cost levels. Management must recognise the desire and the natural approach of labour to try to maintain their workers' standard of living and labour must recognise that the company must be cost effective in a competitive area. Both sides should recognise each others position and try to come to a settlement that will be fair and reasonable. I was glad to hear Senator Cullen say that both sides have as their objective a settlement of the dispute. They go in to get the best deal they can at the table but they must have that objective in mind. I would like to thank my colleagues for allowing me to contribute.
I want to thank Senators Raftery, Neville, Cosgrave and Cullen for the opportunity to say a few words on the Waterford Glass dispute. All Senators have been helpful and have made it easy for me to say a few words because it is too difficult and too early in any negotiations to be anything other than vague.
As Senators are aware, we have been involved in this dispute for the past number of weeks in an attempt to secure a basis for negotiations to begin talks. That proved to be quite difficult. Everyone knows the story behind that. I am happy to put on the record of the Seanad that the formula which I put to both sides for the commencement of negotiations was accepted. I appointed an independent chairman and negotiations began today. I do not want to say anything that might prejudice the outcome of negotiations beyond a few general comments. I thank all Senators for being responsible in that regard because it is, as everyone appreciates, a delicate matter.
I would like to wish both sides well in their attempts to reach agreement. I would ask them to approach negotiations in a spirit of goodwill and conciliation and to ensure the long-term viability of the company which is in all their interests. I concur with the remarks of all the Senators who said that.
Waterford Glass is one of our greatest enterprises, as Senator Raftery said. It is an international success story and its demise would have both local and national effects. It is important that the company continue to exist and, indeed, prosper. In numerous company disputes the people do not always realise how well they are known. In the Waterford case, if I had undertaken all the requests from people on radio programmes outside Ireland who wanted me to say something — which might have been unhelpful — I would have been on international radio for a few weeks. I declined all of those requests but people should realise how international competitors are prepared to jump on a bad news story. If Waterford Glass were launching one of the many hundreds of products they produce and wanted publicity, unfortunately they would not have got the international media attention to the extent that I and others had over the last few weeks.
Any successful undertaking results from a combination of capital, labour and enterprise, and one is no good without the others. The key to success is the co-operation of management and workers to create quality products at a competitive price so that production can expand. That is the nucleus of the story. I would ask both sides to bear that in mind. A combination of cutting costs and increased productivity will lead to a successful outcome and either on its own is not the answer. We have to look to both sides.
I thank Senators for raising this matter. This has been my only opportunity throughout this dispute to thank Senators for their restraint in regard to public comment over the weeks. In particular I would like to thank the media who, in all industrial relations disputes, are extremely responsible and helpful. In this case I would like to single out one of the Members of the Seanad, Senator Cullen, because he was at the heart of the dispute and in a very difficult position. I have had many contacts with him in industrial relations disputes. Nobody can read onto the record of either House or onto any file, for that matter, the nature of contacts that go on in industrial disputes.
Members from the other House were also involved but I want to acknowledge the role of the Upper House in this and say that work in relation to this dispute, and other disputes, has always been on a non-party and non-political basis. That has been the practice of the Houses of the Oireachtas for many years and it was used efficiently and effectively in the dire days of last week in this dispute. As Minister for Labour I want to acknowledge that because it is a practice and precedent that has existed in both Houses down through many Ministers. Such practice is vital in trying to come to grips with industrial disputes and I appreciate it, particularly in this dispute where it was not possible to get the results I was seeking without assistance from a number of people. Like other Senators, I want to mention the work done by those people, whether in all Church circles, business circles, trade union circles, other than those involved, such as the Irish Congress of Trade Unions, the Federation of Irish Employers and many individuals in Waterford, and nationwide, who were concerned about the outcome. The important thing now is that negotiations have commenced and there is great pressure and responsibility on those involved without anyone adding to that.
I want to thank the various negotiating bodies and people directly involved in this dispute and wish them well in the arduous work ahead. It is a difficult task but I have every confidence that they can overcome their difficulties and that we will see a continuation of one of the most successful Irish companies that ever was, Waterford Glass.
The Seanad adjourned at 8.25 p.m. until 10.30 a.m. on Thursday, 31 May 1990.