Amendments Nos. a1, b1, 2a, 11c and 30 form a composite proposal and we will discuss them together.
Industrial Development Bill, 1993: Committee Stage.
Section 1 agreed to.
SECTION 2.
I move amendment No. a1:
In page 3, subsection (1), line 27, to delete "Forfás or".
I thank the Minister for his attendance at Committee Stage. The substance of this amendment and the related amendments — there could be many more if we were pedantic about the Bill — is to delete "Forfás" from the Bill.
The establishment of this agency was not one of the recommendations in the Culliton report which, when it was published, received support from all parties. Its establishment creates another unnecessary layer of bureaucracy. The central recommendation of the Culliton report was that there would be two bodies and that there should be a new agency for the development of indigenous Irish managed industry to bring together, in a more integrated way, the development and support services provided at present on a separate basis by the IDA, ABT and Eolas in particular. Such an agency would provide a new impetus and focus for promoting the development of locally based industry. The report continues that there should be another agency formed from the present IDA to deal with internationally mobile investment.
I acknowledge that those aspects are dealt with in the legislation, and the Bill, in those respects, conforms with the Culliton recommendations. However, I do not understand the need for this other agency. The Minister, on Second Stage, talked about encouraging a dynamic spirit of enterprise. That is to be welcomed, but I submit that the establishment of Forfás does not conform with such encouragement of a dynamic spirit of enterprise — nor do the 1 per cent levy and other taxes but they were discussed yesterday on Second Stage and I will not deal with them today.
Forfás is an unnecessary appendage. We are bedevilled in this country by inter-agency rivalries that inhibit progress and development. Some of this rivalry between agencies focuses on claiming responsibility for certain sectors. That type of rivalry has spilled over into Government where we have the establishment of the Department of Tourism and Trade. In my view trade should more appropriately be dealt with in the former Department of Industry and Commerce; I would not object to the former Department of Labour being included in the remit of the former Department of Industry and Commerce, now the Department of Enterprise and Employment; it could even be argued that foreign trade could be dealt with by the Department of Foreign Affairs through the appointment of commercial attachés to our embassies. The creation of a new agency is another layer of bureaucracy and another vehicle of interagency rivalry. We should simply establish the two agencies recommended in the Culliton report.
I support the amendment.
If a definite number of jobs could be created by the establishment of this new agency it would be worthy of support. However, we are only moving the deckchairs and putting new signs over the same offices. In this case, there will be a new board competing with the others. I support the sentiments expressed by Senator Dardis and I believe two agencies would have been appropriate for overall industrial policy. Given the talk about a new approach I thought this Bill would have shown we meant what we said but we are not doing that when we establish Forfás. That is why I support this amendment.
It outlines in the explanatory memorandum of the Bill that the purpose of Forfás is to supply policy advice and co-ordination in respect of the other two bodies, and in general. It is an umbrella organisation to co-ordinate the work of the other two bodies. I see it as having a very clear function in the whole system.
Let me address this comment, because it is fundamental to much of the thinking in this legislation. I regret that due to other factors I was unable to participate fully in the Second Stage debate yesterday. I would not like Members of this House to think that I was not interested in their comments; in fact, I have appraised myself of what has been said and I intend to be present for all subsequent Stages of this Bill.
It is fair to say that this legislation has a number of parents. Mr. Culliton is not the sole proprietor of its recommendations. I declare a certain degree of shared parentage in this matter. The Moriarty task force was appointed by the person who commissioned the Culliton report to recommend the best method of implementing the Culliton report. That was not done to delay its implementation. It was recognised that while there were very eminent people on the Culliton committee, their knowledge of politics is somewhat limited and their knowledge of the practical implementation of their recommendations is even more limited. It was for that reason that a very wise former Minister for Industry and Commerce, the Leader of the Progressive Democrats, sought to recommend that while we have these very wise recommendations, among which the agency restructuring was a minor one relative to the broad thrust of the Culliton report, the Moriarty task force was comprised primarily of people who knew the territory, and they proposed a number of recommendations as to how best the Culliton report, in the broadest sense, could be implemented. That, therefore, forms part of the background to this agency restructuring.
A second part of the background was the Leader of the Fianna Fáil Party, the then Taoiseach, and the incoming Tánaiste, leader of the Labour Party, who together recognised that there was a need to restructure the departmental arrangements of the Government as it was then. In addition to that, the negotiators of the Programme for a Partnership Government — on the Fianna Fáil side they were Deputies Ahern, Cowen and Dempsey, and on the Labour side they were Deputies Taylor, Howlin and myself — negotiated over approximately four weeks an elaborate programme, within which the recommendations of the Culliton report were broadly accepted. We accepted there was a need to implement the report in a particular way. The entire Culliton debate in the autumn of 1992 was characterised by rows and rivalries between agencies which totally obscured the main intellectual thrust of the report. You cannot argue with geography. If the Rocky Mountain range is there you negotiate your way over it or round it; you do not say it does not exist. For that reason, we came up with a formula — I am quite comfortable intellectually in standing over this — that dealt with the best way to address the two conflicting arguments clearly articulated in the autumn of 1992.
The solution reached was the formation of one supra-agency for the purposes of co-ordination and lack of duplication of costs, and two separate hall doors with different labels, one for foreign investment, to be called IDA (Ireland), and one for indigenous manufacturing and related types of activity which would need more than the kind of services that IDA (Ireland) could provide for an already established company. What we have come up with is a tripartite triangular structure, a holding company between the Department of Enterprise and Employment and two separate agencies. There are many retail organisations in this country whose ultimate ownershp is held between two or three companies, but as far as the customer is concerned there is one body only. There will be only one door through which foreign investment will have to pass called IDA (Ireland), and for companies establishing themselves there will only be one door, that is Forbairt. This is clearly in line with what Culliton and Moriarty and others have frequently argued for, namely, clarity in relation to what is required, and a separation of the activities of IDA (Ireland) in attracting inward investment into this country, which is one set of tasks, and the totally separate, but under the present structure the related task of trying to help indigenous companies to prosper and grow. That is why Forfás is to be established.
At this point I can refer to why ABT is separate and related to Forfás in the manner set out. The Taoiseach and the Tánaiste decided, and this was endorsed subsequently in the Oireachtas, that there would be a Department of Tourism and Trade. The Minister for Tourism and Trade, Deputy McCreevy and I looked at a number of ways in which we could take some of the marketing functions currently held by ABT and locate them in Forbairt. The three essential elements of any prosperous enterprise are product, marketing and finance. Marketing is an essential component, particularly in the globalisation of world markets. In the domestic market with the advent of free trade, marketing is critical, even for companies which traditionally confined themselves to their own domestic market. We looked at homw to take the domestic marketing component out of ABT and locate it in Forbairt. We investigated several ways of dividing ABT, by sector, by threshold size or by the employment level of the firm involved.
We investigated the possibility of transferring that section of marketing into Forbairt, to add to the different kinds of help available from Forbairt for small indigenous industry, given the structure, consisting of Forfás, IDA (Ireland) and Forbairt, given ABT, the morale of the organisation and its personnel, both Deputy McCreevy and myself decided it would be better not to split the organisation, because a contradictory system would evolve from such a split. We also knew that the specialist group set up under the Culliton committee, the recommendation on food group, although it had not completed its final report, was going to recommend something like An Bord Bia, as it subsequently did. Some form of co-ordination at the policy level was desirable to avoid duplication because resources are scarce.
I may be wrong but I believe we have come up with the best compromise, and it is unashamedly a compromise, between what is feasible, what is desirable and what can be implemented quickly and put in place without all the energies of the people who work in these agencies being diverted into fighting new wars and new corners of career paths for themselves, and not looking after the customer.
Senator Hillery will be aware that I was the person who initially proposed the integration of AnCO, the Youth Employment Agency, and the National Manpower Service in a Bill that fell on the dissolution of the Dáil in 1987, and resurrected itself as FÁS. Any customer who knows FÁS will concur when I say that for about 18 months the internal energies of that organisation were directed inwards because of the managerial uncertainty surrounding its future. We have neither the time nor the resources, and our citizens do not have the patience or the luxury, to allow that.
I am not suggesting that this new structure is an ideal one plucked from heaven, it is not, but it is designed to recognise that obstacles exist and we have to get over them as quickly as possible. It is also a structure that recognises the constraints of money and of personnel, and the terms of the employment contracts most people in those agencies have.
This structure is being put into place against that background, informed by what the Moriarty task force recommended and our own practical knowledge as politicians from two parties. It is an amalgam of all those elements being brought to bear with the expertise of the Civil Service. Having said all that, in the context I have defined and described, I believe this is the best possible structure that will enable us to put in place quickly a revised system of assistance to industry that will maximise employment.
I thank the Minister for his reply and I found many parts of it convincing. In fact, his reply has convinced me even more of the need not to have Forfás and to confine ourselves to the two other agencies. I agree with the Minister's remarks on the scarcity of resources and the restraints on money and staffing. That, I think, underlines my argument. He also acknowledged the inter-agency rivalry and that, too, convinces me that the amendment is correct.
I am pleased that the Minister has clarified that the structure outlined in the Bill is not the structure as devised by Culliton, and that it has more to do with the Moriarty task force and the Government's response to the Culliton report. I am pleased about that because several speakers referred yesterday to the fact that what was being implemented was a main recommendation of Culliton. They should not have said that because it is not, and the Minister has confirmed that. From that point of view I welcome his answer.
The Minister said he was comfortable intellectually. When the Minister says that I get very uncomfortable and not from an intellectual point of view. What we are establishing here is a holding company, and I accept that. However, while I take the Minister's point that not all the proposals are from Culliton, what Culliton said was that "the two industrial promotion agencies which we recommend should have inter-locking board membership". The structures which are most appropriate to industry may not be the structures that are most appropriate to Government or Government agencies. Even that point was acknowledged in respect of the Culliton report when the Minister mentioned the political dimension.
It is not consistent to argue that there should be a structure similar to an industrial one for a holding company, having previously said that the Culliton report did not take into account the political aspects of the issue. Government and business do not operate in the same way, even though they should have the same thrust with Government operating in a business-like way. However, that is not to say it should have a structure that is more appropriate to business than to Government agencies.
The Minister may have been more cerebrally comfortable than intellectually comfortable in the sense that it was a thought out position in which he was contextually comfortable. That was certainly the way I heard it.
I said on Second Stage yesterday that I had listened to the agruments as to whether there should be one, two or three agencies, and that this discussion had been going on for the last year. I have not heard such certainty on two sides of an argument since the pro-life debate. Everybody is certain of their point of view. I could not hear precisely whether the Minister said that he and the Minister for Tourism and Trade, Deputy McCreevy, abhorred or applauded the rivalry between their Departments.
I compliment the Minister for having the grace to say he thinks this is the best proposal he can put forward. Everybody has put forward a point of view, but nobody has come up with the answers. There is a party political agenda to which Senators on these benches do not need to subscribe. I said last night I did not know which was the better proposal, two agencies or three, but the Minister has given the clearest response to a question on Committee Stage I have heard for a long time. He has taken us right through the difficulties — warts and all. We have all been aware of them, have read about them in the newspapers etc. I am one of the people who has never been completely comfortable with all the Culliton proposals. I have been consistent in that, not that consistency should be held up as a virtue. There may be faults or flaws in either proposals and, as I said yesterday, I am prepared to support what is in the Bill, to give it a chance to see if it works.
In trying to find a balance between the proposals for two or three agencies, one of my problems is that I have always had a difficulty with the IDA itself in that it did not have a continual responsibility to report to another body, although the Department was there in a sort of overseeing role. I am attracted to the idea of Forfás being there to insist on a monthly or six-monthly report. I would presume that the first item on the agenda at each meeting of the Forfás board would be reports from Forbairt and IDA (Ireland). That at least creates an in-built justification, accountability and a need to explain policy.
Can Forfás call the shots as envisaged by the words "advise and co-ordinate" in the Bill? That seems weak, and that is where the argument would tend towards Senator Dardis' side. The word "co-ordinate" suggests that each sub-agency decides what it wants to do while ensuring they are complementary and that there is no conflict between them. I would prefer if the role was more clearly defined because, in my reading of the functions, I do not see an overriding directional role for Forfás. I would like to know how far its functions extend. For example, can Forfás tell one of the other agencies it is going in the wrong direction? If that is the case, it changes the whole ball game and means that both agencies cannot be in conflict with each other chasing the same market. That can happen because, even though the national and international areas are supposed to be separate, their sub-regions can overlap. We are not even clear in this country what the nation is, so the terms "national" and "international" could create their own problems within this island.
I would like to hear the Minister say whether Forfás can call the shots and decide policy direction. It is not merely a question of giving it a job to do and saying how to do it. We are saying this is not the context in which it should be working or the area it should be developing. If Forfás is to be established there should be a sense of accountability upwards and a sense of direction downwards. That would be the best way to develop a complementary approach.
I am much in agreement with the comments of Senator O'Toole. I welcome the Minister's response to Senator Dardis because it helped confirm for me what I assumed was the background to this Bill. To quote the Minister in another context, I was not intellectually convinced by this legislation but I took the view last night that the Minister was highly intelligent and I was prepared to trust his judgment as to what was the best thing to do under the circumstances.
I would not go quite as far as Senator Quinn and call the Bill "a shambles" but it is cumbersome in many respects and what the Minister has said today has confirmed that. I am still prepared to trust his judgment although I hope when we look at it in detail he will allow his judgment to develop over time and not wait for three years to revise issues that have begun to go wrong.
I am interested in what Senator O'Toole has said about the relationship of Forfás to the other two bodies. Section 6 (d), about Forfás, says it will "encourage the establishment and development in the State of industrial undertakings from outside the State". Section 8 (a), relating to IDA (Ireland), says virtually the same. The two bodies seem to have identical functions.
There is no similar cross-over between sections 6 and 7, at least in textual terms. Section 7 is supposed to be concerned with indigenous industry but there is nothing in the text of the section on that subject. We simply have to accept that is what it concerns. It strikes me as being curious drafting, without wishing to reflect further. The precise relationship between Forfás and the other two organisations is a skewed one. I would appreciate a comment on that.
There should also be a comment on what Senator Dardis has said because he has raised a valid point. I am not convinced we should have two agencies. If we do, there must be some relationship, whether through interlocking boards or Forfás.
The Culliton report is quoted and is being asked to bear a burden it should not be required to bear. The report was a remarkable document in the time at the committee's disposal. One should pay close attention to it on the areas where the committee members were able to speak from personal authority. Where they were unable to pronounce from comparable personal authority matters are more open. One should pay attention to their views but by no means should one feel constrained to follow them.
I do not wish to detain the House but I meant to raise a matter when I spoke earlier which I will mention now. The Minister in his reply referred to the food industry and An Bord Bia. On Second Stage I said I was unclear as to where responsibility for this lies, whether with the Department of Agriculture, Food and Forestry, the Minister's Department or the Department of Trade and Tourism. In his Second Stage speech the Minister said the Irish industry division of IDA would be responsible for food companies regardless of ownership. Forbairt is supposed to have sole responsibility for the development of the food industry. I would be grateful if the Minister could clarify that.
First I will return to the earlier points Senator Dardis made. My concern is with speed of implementation. I also wish to avoid not just duplication but the diversion of energy and effort into areas that do not look after the customer, if one wishes to use that word, or the unemployed, but are more concerned with the internal requirements of the organisation. The Bill is somewhat vague and non-specific in order to allow us options. Senators on all sides have identified that and I shall give reasons why it was done.
Given the requirements of the IDA and Eolas, we are not yet clear what the precise allocation of staff should be and how many should be in one organisation or the other. All the current assets, holdings, obligations and responsibilities, including staff of both Eolas and the IDA, will be vested under this Bill in Forfás. There will be flexibility in our ability to allocate staff. Alternatively, we would not do that and establish two separate organisations on the splitting up of the IDA and Eolas. Before we could bring in the regulations to commission these bodies, we would have to deal with those matters. Officials in the Department of Enterprise and Employment have already had exploratory meetings at the requst of the unions. They sought to find out the implications of this legislation for them and their members. Senator O'Toole would readily appreciate that.
There are two other areas of potential diversion of energy and attention. How would one deal with the existing IDA land bank and arbitrate between what was needed for domestic industry and what was needed for inward investment? By vesting the ownership of all this land in Forfás, if an inward investment company wishes to come to Ireland and we want to use a corner of an industrial estate because it suits, we have the flexibility to allocate it to that company. On the other hand, if we did not do that and local geography determined property should be assigned for local development under Forbairt, we would have the added complication of transferring ownership from Forbairt to the IDA. Land transactions would be involved.
The third legitimate reason for a holding company is the vexed question of pensions and pension funds. At present the matter is complex. The IDA has a pension fund garnered in the normal way. Eolas does not have such an arrangement. How would one divide that? What we are doing here is different from what was done on the establishment of FAS. There three organisations were joined, two of which had pension funds, the YEA and AnCO. One of those was hopelessly under-funded at the time. Civil servants were also included in that organisation. These issues bring any sort of organisation to an immediate standstill, especially one in the public sector. It can do little for anyone else if it feels threatened in its own conditions of employment.
I concur with what Senator Lee has said about the competence of the Culliton committee. When they spoke from direct experience of the areas with which they had contact they spoke with great wisdom. They made specific recommendations about agency structures. I spoke to Mr. Jim Culliton about this because I wanted to satisfy myself as to the intent of that body. I respect the commitment and thrust of the recommendations given, as Senator Lee said, the report was concluded within six months.
I hope I quote Mr. Culliton accurately but it is open to him to correct me. He said the committee in the latter part of its six month deliberations was in consultation with industrialists. They found great confusion and frustration with being required by different State agencies to go from one body to another. That was bad enough. In addition, the industrialists were required by the different agencies to produce slightly different sets of statistics or the same statistics with additional information in a different format. In the view of the industrialists questioned much administrative work and paperwork was unnecessarily asked of them. They wanted clarity in that task. That happened to domestic entrepreneurs who wished to either start a new enterprise or expand an existing one. The same difficulty does not exist for foreign inward investment. Statistics show the attraction of inward investment is where the IDA has been most successful.
To address Senator O'Toole's second point, Forfás will be able to call the shots in terms of co-ordinating policy. However, policy will originate within the Department of Enterprise and Employment as recommended by the Culliton report and the Moriarty task force report. The Department is deficient in formulating policy because that branch of the Department, previously Industry and Commerce and now Employment and Enterprise, was allowed to decline. In a manner similar to many State Departments over the past ten to 15 years, the intellectual centre of gravity was allowed to shift out from the Department and into the commercial State-sponsored bodies such as Aer Lingus, Bord na Móna, the ESB and the IDA. Therefore the IDA, which was an executive agency, on the basis of its knowledge of the real world was able to dictate, if not formulate, policy in the Department.
That process was adopted by the entire political establishment during successive Governments. It is a process I regret and which must be reversed. Therefore, I state unequivocally that political and accountable policy will originate in the Department. Forfás will be used as a body to develop that policy function and to advise on its implementation. This will be combined with the co-ordination of how that policy is delivered on the ground at the level of the two executive agencies, Forbairt and IDA (Ireland).
To achieve that co-ordination, the membership of the board of Forfás will include, in an ex-officio capacity, the chief executives of Forfás itself, IDA (Ireland), Forbairt, An Bord Tráchtála and FÁS. These five chief executives will meet on a monthly basis with the chairperson of Forfás and, also in an ex-officio capacity, the Secretary of the Department of Employment and Enterprise. These people will have executive responsibility to ensure that the various bodies for which they are responsible interact and co-ordinate their activities together. I believe that would be a powerful way of ensuring co-ordination and of avoiding the kind of things unearthed by Culliton in the course of his discussions with industrialists.
It is necessary to explain what is meant by co-ordination. By way of example, the format of information required, the type of data required and the manner of its presentation, in so far as one can be so prescriptive, would be co-ordinated. This would ensure that the same kind of documentary profile of a particular prospectus, company or proposal would be valid for different agencies without the necessity for re-design.
I commend the Minister for the mastery of his brief. Unlike other debates we are making progress in so far as the issues are being addressed.
Perhaps the Minister would remind his colleague, the Minister for Transport, Energy and Communications, Deputy Cowen of his remarks to this House on the subject of telephone charges when he said the Government would implement all the recommendations of the Culliton report.
There is one point which I ask the Minister to clarify. I accept his statement on the departmental policy function and Forfás. The Culliton report made a recommendation about an advisory board on industrial policy which should be established and attached to the relevant Government Department. Will Forfás fulfil this function and, if so, will there be a need for this board?
Amendment No. 11 (c) to section 9 of the Bill reverts to the point made earlier on the need for two agencies. The amendment refers to powers and functions of Eolas being vested in Forfás. Will the Minister explain why this is necessary as opposed to vesting them in Forbairt or IDA (Ireland) or Forbairt and IDA (Ireland)?
I do not agree with the recommendation of the Culliton report on the advisory board. I wish to have the functions of such a board integrated in the Department as a line function. In that role in the Department it should take upon itself inputs from outside and I would envisage Forfás informing that in some way. It is also envisaged that the planning function currently held by the IDA would be transferred to Forfás and that there would be some degree of interaction. There is insufficient lateral movement between industry and the public sector in this country. The French are, I believe, the best exponents of this. We are too compartmentalised, with insufficient information. I hope this answers the Senator's first question.
Regarding his second question, there could be indefinite debate on which section of Eolas should transfer to IDA (Ireland), which section should transfer to Forbairt, which section has to be transferred to the new Environment Protection Agency and which section is to be retained for the National Standards Authority of Ireland. The most expeditious way to proceed on this, and I am seeking the authority of this House to do this, is in the first instance to vest all the functions, property and liabilities of Eolas in Forfás as a holding company. As policy evolves it should then be decided on the disbursement of activities. We do not have all the answers at present but we do not have the luxury of waiting for these answers.
Question put: "That the words proposed to be deleted stand."
The Committee divided: Tá, 30; Níl, 15.
Tá
- Bohan, Eddie.
- Byrne, Seán.
- Calnan, Michael.
- Cashin, Bill.
- Cassidy, Donie.
- Crowley, Brian.
- Fahey, Frank.
- Finneran, Michael.
- Fitzgerald, Tom.
- Gallagher, Ann.
- Henry, Mary.
- Hillery, Brian.
- Kelleher, Billy.
- Kiely, Dan.
- Kiely, Rory.
- Lanigan, Mick.
- Lee, Joe.
- McGennis, Marian.
- McGowan, Paddy.
- Maloney, Seán.
- Mooney, Paschal.
- Mullooly, Brian.
- O'Kennedy, Michael.
- O'Sullivan, Jan.
- O'Toole, Joe.
- Ormonde, Ann.
- Quinn, Feargal.
- Roche, Dick.
- Townsend, Jim.
- Wright, G. V.
Níl
- Belton, Louis J.
- Burke, Paddy.
- Cotter, Bill.
- Cregan, Denis (Dino).
- D'Arcy, Michael.
- Dardis, John.
- Doyle, Joe.
- Farrelly, John V.
- Honan, Cathy.
- Howard, Michael.
- McDonagh, Jarlath.
- Naughten, Liam.
- Neville, Daniel.
- Ross, Shane P.N.
- Sherlock, Joe.
Tellers: Tá, Senators Mullooly and Calnan; Níl, Senators Dardis and Neville.
Question declared carried.
Amendment declared lost.
Section 2 agreed to.
Sections 3 and 4 agreed to.
SECTION 5.
Amendment No. b1 not moved.
Section 5 agreed to.
SECTION 6.
I move amendment No. 1:
In page 4, subsection (1) (a), line 31, after "State" to insert "in order to achieve the highest possible level of sustainable employment through maximising net job creation".
I tabled this amendment to indicate that, as far as I can see, there is no specific reference to the ultimate purpose of the legislation which is, I take it we all agree, to foster employment. That should be specifically included in the Bill.
The amendment goes beyond that. As the Minister said in his recent statements to this House and in his statement yesterday, there is a huge problem with job losses as well as with job creation, and much, if not almost all, of the emphasis of the IDA hitherto has been on job creation. The last IDA annual report which I can obtain is for 1991 and it does not have any information about job losses. It presents its achievement in contributing to job creation in a positive light, but what it presents in its report seems far removed from what many people on the ground are experiencing. For that reason I have made the reference to "net job creation" in the amendment.
If the culture of these new agencies is to change from that of the agency they are succeeding, they must consider the concept of net, as opposed to gross, job creation, and they must be as concerned about saving jobs as bringing them onstream. That involves such a shift in perspective, in attitude and in the concept of incentives in the agencies that it is necessary to have it included in the legislation and not to allow slippage to occur in those respects. These were my main objectives in proposing this amendment.
On Second Stage yesterday I mentioned the problem this amendment addresses. Consider the figures the Minister gave whereby over a period of six years from 1987 to 1992, 118,000 jobs were created and 108,000 were lost. This amendment would strenghten the Minister's hand to ensure that there is an emphasis on saving jobs when difficulties arise. We are all aware that if help was available or decisions were made by Government agencies, for example in granting moratoriums on tax collection, to give a breathing space to companies who find themselves in difficulties, jobs might be saved.
I know the Minister is involved with companies at present to ensure the protection of existing jobs. I also mentioned a major company in my own constituency which is on a three day week. It is not up to them whether they will close. It will be the decision of the parent company in the UK whether they will be prepared to ensure the long term viability of the plant. Anything that can be done to insert in this legislation a provision of a small organisation to deal with these problems is welcome. This is as important as having agencies looking for new jobs since every job saved is two earned.
Having been in business for over 40 years I feel that the preservation of jobs should be as vital as the creation of jobs. It costs ten times as much to create a job as to preserve it. When one looks at the IDA bringing jobs into Ireland it must cost about £40,000 per job. If one gave from State funds the present average industrial wage to those at work that would be creating jobs in the sense of not losing them. There are industry-creating enterprise boards who carry out the task of attracting new jobs to the country but once those jobs are here they are forgotten about. They can be lost after 15, ten or even five years.
The indigenous industries have been set up by people who are enterprising and are prepared to work for themselves. They put their energy and resources into the economy but they get no help. When they find themselves in trouble there are demands for PAYE and PRSI payments but when foreign companies go they are said to have left with irretrievable losses to the State. These losses are irretrievable because the companies cannot be contacted. I will not go along with the amendment but I agree with the principle behind it.
I do not understand how the Senator will be able to do that.
I go alone with the principle of the amendment because we must analyse what is happening in Ireland and preserve jobs. Senator O'Toole said yesterday evening he feels that there is a ten year life in any worker.
I did not say that.
I sincerely hope the Senator will tell that to the next INTO conference and suggest——
I ask the Senator to withdraw that remark immediately. A Chathaoirligh, may I correct the record?
The Senator may do so subsequently.
You cannot correct the record because the record is there.
Senator Lanigan, please speak through the Chair.
The Senator can adjust the record but he cannot correct it. Senator O'Toole said yesterday that every job in this country should be recycled after ten years. I would like him to get up at an INTO conference and say that every teacher should be recycled after ten years.
May I correct the record? In supporting the amendment of Senator Lee I particularly point to the words which underline my point; they are "sustainable employment". There is no problem creating employment if, as I said yesterday, it is not sustainable employment. If we ignore the advance of technology, and if we have four people doing the work of one person as was done in eastern Europe for years, there is no problem maintaining a net number of jobs, What I said yesterday was that there are very few jobs that can continue beyond ten years without change. We need a flexible and well educated work-force and that applies to all levels of work including teaching. I said that in the past and I will continue to say it. A teacher can no more stand still in the face of a changing world than any other group. The recent Green Paper on education was entitled Education for a Changing World. In my response to that I made exactly the same point as I made last night, that no job can continue immutably beyond ten years. It needs to change and be flexible and take account of changes in technology, work practices, needs and responses.
Ten years ago AIDS education was not an issue and drugs education was only becoming an issue. Ten years ago the Stay Safe programme relating to sex education and child sexual abuse was not considered important in the area of education. I give those as examples to stress to Senator Lanigan, and I hope he takes the point correctly on this occasion, that nothing is without change, including education. I have no difficulty standing up at INTO conferences — I have done it before — and saying to teachers that the last thing they should oppose is change, that no job can stay the same, that we must all be prepared to change. This legislation should create the proper context in which change can take place. As Senator Lee outlined, the objective should be to hold sustainable jobs, to recognise that there are some jobs which are not sustainable in their present form and that energy must be directed in another way. It is not to say that no worker has ten years. It is a job, not a worker, because a worker can do four different jobs in a career.
There are two issues here. One is the text of the amendment as proposed by Senator Lee and the other is the thrust behind it which is essentially the concern about net employment at the end of the year. I share that view and I explicitly referred to it on Second Stage.
I propose to accept Senator Lee's amendment No. 24 which states in relation to the reports that "... every such annual report shall specifically comment on both job creation and job losses". The reason is twofold. First, if I were to accept Senator Lee's explanation as to why the first function of Forfás is so qualified, where the function is stated and then the reason for the function is given, there would be a certain imbalance in respect of every other stated function because similar reasons are not given. I refer to a previous job that I once had and that was design, albeit of a physical rather than a literal kind. There would be an imbalance in the wording of this section and for that reason I will not accept this amendment because every other stated function would need to be qualified and an explanation given.
I will accept amendment No. 24 to the First Schedule for the following reasons. First we are kidding ourselves as we kidded ourselves in the mid-1980s about migration in this country. We kept talking about net migration being quite small and I was Minister for Labour at the time. The figures for net migration were 2,000 or 3,000 but the outflow was 30,000 for people who were forced to leave, who had problems with this country. The inflows were of people retiring and returning home who had no problem whatsoever. By saying the net figure for migration was only 3,000 or 4,000, we were diminishing what was a problem of a 30,000 dimension. Likewise if we do not examine job losses, if we do not talk about job creation, we are not recognising the causes of job losses.
As Minister for Enterprise and Employment I want — and I want my successors also — to be told officially by bodies that we are losing jobs in certain areas, that some of the reasons for that are those over which we have control, be they uncompetitive costs in terms of salaries, practices or legislative requirements that we have chosen to put upon ourselves. As an Oireachtas we should be told that these things are happening. How we wish to deal with them is a matter for ourselves but the annual report of an agency which is charged with the responsibility for promoting industrial activity should address this matter.
The second reason I am rejecting the amendment is more fundamental but it is related. There seems to be an increasing link, and the Senator's historical studies will confirm this, between wealth creation in developed economies and a diminishing employment base. We can produce more with fewer people. Historically it was done 120 years ago with agriculture, starting in the United States of America where over 50 per cent of the working population was involved in primary agricultural production. It is now down to approximately 2 or 3 per cent and they are producing approximately ten to 15 times more. If one takes out science and technology application of fertilisers they are still, with mechanisation alone, producing far more now in terms of output with less imputs of labour content or jobs. There is clear evidence, from Japan to here, that robotisation, automation and other factors will enable factories and firms in manufacturing and related activities to produce and create more wealth with fewer jobs.
We may very well want to make the choice between promoting industrial development, which is wealth creation, because it is the right thing to do, in the clear knowledge that it is not necessarily producing additional jobs but the wealth which we would retain from that kind of industrial activity could, if the Oireachtas so chooses, be used for employment in other areas. The traditional linkage between employment creation and wealth creation in the industrial sphere is being loosened or stretched. If it was a one-to-one relationship before with one unit of wealth for one job created, it now seems to be one unit of wealth created for perhaps a half or a third or a quarter of a job created because of the productivity factors I referred to earlier. That is a deeper argument.
I will accept amendment No. 24 for the reasons I stated. I am not accepting the amendment in relation to stated functions because all the other stated functions would have to be qualified in section 6.
The Minister has disarmed me by expressing his willingness to accept my amendment No. 24. Otherwise I would have entered into a more prolonged exchange with him.
I take the point the Minister made about job and wealth creation, but my amendment is carefully phrased and could be accommodated even within that process because sustainable employment can be interpreted to mean sustainable employment in the economy as a whole and how one achieves the optimum level is a matter for further contention. The points the Minister raised are important and require more research into their implications for Ireland because while it is true that there can be, and has been historically, intensive technological unemployment, this would be the first time in history where technological unemployment would exceed technologically generated employment, if we are now reaching that stage in world economic history. Without lingering over that point I would have sustained the discussion with the Minister on the grounds that it is premature, in the context of our knowledge of the economy at this stage, to pursue that line as if it were evident as distinct from a possibility.
On the other issue, I am sorry that my inexperience led me to put it there rather than under the functions of An Bord Forfás. It is strange, excepting the Minister's generous acceptance of amendment No. 24, in a Bill of this type that there should be only one fleeting specific reference to jobs of any type. It almost reinforces what one fears is the self-image of all institutions — that they exist only for themselves and that what is out there is a residual by-product of their existence. I am also concerned that — even though amendment No. 24 may cover it — unless there is a specific commitment to the concept of net job creation, whether within the context of industry or the economy as a whole, it will be possible to fudge and to blur, in terms of reports, the performance of these agencies over the next three years.
In section 13, the Minister undertakes to have prepared a review of national industrial performance in respect of the previous three years, but what are the criteria of national industrial performance in that context unless there is a specific commitment to net job creation as at least one key factor, if not, as I would argue, the key factor? Everything else seems to be a means to an end; that is the end.
There should be at least a section in either or both of these agencies concerned with job protection and job saving and it must go beyond there being a section. The culture and philosophy of the agencies must be permeated by the importance of saving jobs, and that must not be hived off to one section marginalised within the totality of the agencies unless there is a mechanism for insisting on its centrality in the way they approach matters.
A major problem of industrial development in this country is growing companies. Enormous emphasis is laid on establishing companies and we talk about the lack of an enterprise culture because not enough firms are set up. It is not clear that we lack this type of culture in as dramatic a way as many would assume, because the statistics used are vague. What is striking about our statistics is not the number of companies being established, but the number that collapse within the first three or four years. It is possible that some of them did not have a hope of surviving, but a number of them may have been founded with good prospects and on interesting and intelligent ideas by people with energy and commitment, but due to circumstances beyond their control they floundered. We have on balance, small indigenous companies and we are asking them to compete, domestically and internationally, at an early stage of their development. I cannot think of any other country in the industrialised world which expects this. It may be that many of the companies could be saved by considerate and sympathetic treatment at an early stage in terms of job saving and could go on to become developed and bigger companies who could be job creators in their own right.
While I will not press this amendment to a vote — although my instinct was to do so — I hope the thrust of what I said will find its way into the approach of these agencies and that when the Minister is considering the evolving situation, he will find mechanisms by which this type of thinking, which I know he partly shares, will be incorporated into the policy forming functions of the Department and the implementation function of the agencies.
I am delighted that the amendment is not being pressed but we should reinforce the arguments made. In this Bill, there is a suggestion that job and wealth creation go together. Those who have worked to create jobs in this country have not become wealthy. Those who have become wealthy have been supported by various Governments. Senator Quinn never got a job creation subsidy but he has created sustainable jobs. There should be a relationship between job creation and wealth creation. When someone sets up a business to many people he suddenly becomes a leper, and this view is shared by the Department of Social Welfare and the Revenue. The attitude that job creation becomes wealth creation should not be entertained and I sincerely hope the mentality in Forfás, IDA (Ireland) and Forbairt will be to create sustainable jobs and will not be taxed or run out of existence because of the many bureaucratic layers laid down by State agencies. These agencies will require that if a man wants to provide a job for someone else, he must prove he does not need money from the State.
Some 90 per cent of our entrepreneurs are leaving because they cannot create jobs and are being stifled by bureaucracy, and the Minister knows what I am talking about. The Minister was involved in the architecture industry and he knows what has happened in that profession over the last ten years. How many have been forced out because of Government action or inaction? I suggest there were 20 people forced out because of Government action rather than inaction.
I realise the amendment is being withdrawn, but the sentiments expressed by Senator Lee must be considered if we are to have a reasonable chance of creating sustainable jobs.
I appreciate that Senator Lee is not pressing the amendment but may I respond to some of the points he made?
First, we should all understand that this is compact legislation — 21 sections and two Schedules; it does not purport to be the only legislative framework in the economic industrial job creation strategy. In many respects, it is incorporating the remit and the constraints of existing legislation in so far as it operates to the IDA. As both Senator Lee and this House are aware, the IDA is confined to manufacturing activities in internationally traded services. Many sustainable jobs, including those referred to by Senator Lanigan on behalf of Senator Quinn, would not come under the definition of responsibility of the IDA as described by this House. We must bear in mind that this is part of a family of legislation and it might be useful to consider the consolidation of this legislation on a wider basis in the future. We are engaged in part of a family of legislation, we are not rewriting that corpus of legislation.
Senator Lanigan and Senator Lee mentioned job protection and how it is easier, in terms of costs, to maintain an existing job rather than create a new job. Fóir Teoranta was the ambulance, the emergency service for companies.
It was a hearse.
People have mixed views on this. The absence of Fóir Teoranta——
It was a disaster.
I know it was a disaster. However, the absence of Fóir Teoranta inhibits companies experiencing financial problems from receiving equity capital, which would enable them to trade out of their difficulties. We have taken that constraint upon ourselves. There is an additional constraint, that is, the European Community and its laws in relation to competition. These debates are closely monitored in the embassies of larger countries located in this country, and it is no secret that the introduction of the Market Development Fund by the previous Administration in response to the turbulance of the currency crisis was hotly contested by EC member states and the European Commission. This fund attempted to provide on a short term basis, financial assistance to companies experiencing difficulties. Jobs, in which good conditions of employment were negotiated over time as part of the overall structure of the company, were at risk because of currency fluctation and related interest charges.
The absence of Fóir Teoranta and the EC constraints in relation to competition prevent us from doing now what we traditionally did. For example, these constraints prevent me from providing Irish Steel with additional equity because of the surplus of steel in the EC. There is urgent need to address the issue of job losses and to exercise control over market forces. However, we must understand the situation, and this is the thrust of amendment No. 24.
Regarding the reason companies fail, evidence suggests that entrepreneurs who move from middle management because they have good marketing, innovative skills, etc., are not always qualified or prepared for the difficulties in starting up a business. Evidence from FÁS and the innovation centre in Plassey, County Limerick, suggests that if entrepreneur training programmes are run in tandem with the start up of a business, the failure rate will be reduced. This is an area which is under consideration. With a little input these people could avoid making mistakes which novices make.
I thank Senator Lee for not pressing this amendment.
Amendment, by leave, withdrawn.
I move amendment No. 2:
In page 5, subsection (2), line 3, after "given" to insert "in writing".
The purpose of this amendment is to formalise instructions given by a Minister to the chairman of a board. It is proper that a Minister should give instructions on occasion to boards. However, danger arises when these instructions are not given in writing. I suggest that all instructions be given in writing. I was chairman of a semi-State company for a number of years and I did not experience problems. However, I am aware that, in the past, problems arose about telephone calls from Ministers to board members or chief executives of State companies. If the Minister wishes to give instructions to a company, he should do so in writing. The sole purpose of this amendment is to formalise arrangements. This is a more businesslike approach.
It would be cheaper than making a telephone call.
No such calls.
After the activities in Dublin Castle, anything by way of instruction should be carved in stone. I do not want to accept this amendment because every Member must be aware that the legislation we enact goes to a third House of the Oireachtas, the President, who will sign it and it will then be open to the courts to interpret it. Lawyers will interpret it in a legalistic manner, as they are required to do.
As a former chairman of An Post, the Senator will be familiar with situations where requests are conveyed in various ways. If a request is of sufficient importance, the Minister and/or the chairman will ensure that it is recorded in a proper manner so that it can be referred to.
The inclusion of this amendment would be an unnecessary constraint. If every instruction is given in writing, it may hamper the working relationship between a Minister and a chairman. How often do those of us who run organisations issue instructions to management? If the person receiving the instruction has reservations about the instruction he may ask that it be confirmed in writing. Legal requirements would demand that every instruction from a Minister to a chairman be in writing. This amendment, if accepted, would introduce an unnecessary layer of bureaucracy.
I am not happy with the Minister's reply because he addressed this amendment in terms of one manager to another. The State has established companies, passed legislation and appointed boards with the authority to operate effectively. If a future Minister wishes to issue instructions, it should be done formally. The Minister should not address this amendment in terms of one manager issuing instructions to another. It is the shareholder speaking to the company. Shareholders only speak to a company in a formal manner. It is something which should be done occasionally and formally. I will not press this amendment, but it is one which should be considered.
I respect the manner in which this amendment has been put forward and I will address it on Report Stage. We are referring to directives rather than requests and bureaucratic intervention can be avoided if formal communication is made.
Amendment, by leave, withdrawn.
Section 6 agreed to.
SECTION 7.
Amendment No. 2a not moved.
Amendments Nos. 3, 5, 6, 7, 8 and 9 are related and may be discussed together.
I move amendment No. 3:
In page 5, to delete line 5.
I do not wish to sound pedantic in dealing with this although I freely admit these amendments are somewhat pedantic. Section 7 states: "The functions of Forbairt shall be, as an agency of Forfás, to develop industry and technology in the State"— that is just one function. Senator Lee referred earlier to the fact that Forbairt does not have to do anything in the State. He is incorrect in one respect because that is stated at the start of this section, but this is not followed through in the list of how Forbairt should operate. The way in which these are presented is somewhat confusing.
I admit I have made a mistake in my drafting and I will deal with that in a moment. I want paragraphs (a), (b), (c) and (d) to be the functions of Forfás and I believe that is what the Minister intended.
It is.
The functions, therefore, will be to strengthen the technological base, to provide services to make investments and to carry out other functions in order to develop industry and technology within the State. I have phrased the last part incorrectly; it should have said that the functions of Forfás, in order to develop industry and technology within the State, shall be paragraphs (a), (b), (c), and (d). I concede that my amendments as drafted do not do that and I ask the Minister to take account of my point on Report Stage. I know the rewriting involved is minimal, but I believe that the intended functions are not clear. I do not want to labour the point.
I accept what the Senator says and I will come back to it on Report Stage.
Amendment, by leave withdrawn.
I move amendment No. 4:
In page 5, between lines 5 and 6, to insert the following paragraph:
"(a) strengthening the marketing capability of industry".
The objective of this amendment is to highlight the importance of improving the marketing capability of Irish companies. I believe marketing is extremely important. Capability in technology has been singled out as an important factor but we should also recognise marketing capability because it is as important as technology. If we are going to single out technology we should also single out marketing. The need to strengthen the marketing capability of Irish industry is the purpose of this amendment.
I wish to support this amendment. I speak from a family viewpoint and also having seen marketing to the forefront in the development of jobs in Ireland and abroad. Although there may be over-emphasis on marketing in universities rather than on entrepreneurial skills, marketing should be recognised in the Bill. Marketing has become the buzz word in recent years but it is of little use without entrepreneurs.
In an earlier response the Minister referred to the Plassey enterprise in Limerick and in an off-the-cuff comment, changed Government policy on entrepreneurship when he made the clear distinction between training entrepreneurs and trying to create them. There are people who believe you can make entrepreneurs of people from an early age. That is off the wall and bears no relation to the real world.
The idea, however, of creating a resource for people who have shown an innate entrepreneurial talent is very important. I agree with Senator Quinn to the extent that creating a marketing capability, recognising that people have something to give and giving them outlets for it, is more sensible than trying to devise an educational system to create entrepreneurs, because that does not work.
The education system is designed to develop people's innate talents. Those skills and talents are the sine qua non of a successful entrepreneurial approach to life. Some people will have such a talent and others will be successful in different areas of life. That needs to be recognised in a broad education. If somebody has an idea that can create employment and a profit for themselves, how do they bring their idea to fruition? That is where I believe educational support for entrepreneurial instinct is important.
I wish to support the amendment. I have experience of two companies searching for markets abroad. It is an incredibly tough business. Until now companies have had a little grant aid from An Bord Tráchtála. The return on the work involved in getting one's product on a stand at a two to four day show is extremely small.
I often cite the example of Bailey's Cream Liqueur which has been highly successful. They spent £150 million on finding markets and advertising over a few years but there are many small companies without the resources to find markets. In supporting this amendment we are recognising a need to develop marketing. The markets gained by small companies can maintain existing jobs. This can only be done by amalgamating resources and this legislation should emphasise the importance of helping such companies to find markets.
I strongly support the amendment. It is self-evident that marketing is important. Technology is highly important for industry but each goes far beyond the other. The specific introduction of marketing to some extent takes account of the key requirements for industry.
I do not want to repeat what Senator Lanigan and Senator O'Toole have said, but what I see as missing from section 7 is any specific reference to indigenous industry. Section 7 refers to developing industry and technology in the State but the phrase "in the State" is used throughout the Bill to mean everything within the State. It is used for overseas and multinational industries——
Sorry, I accept that; the Senator is right.
There is nothing specifically referring to indigenous industry. I presume that what Senator Quinn had in mind in his amendment was the marketing of Irish industry and strengthening the marketing capability of Irish industry because we invite multinationals in precisely because we assume they already have strong marketing capabilities. That is the major reason for bringing them in. What exactly are we talking about? Is this about indigenous industry? Has the word been unwittingly left out, or are we involved in some other agenda here? Section 7 (a) could apply to indigenous or overseas industry; it is unclear.
The House will recall the genesis of this body. We have decided on balance to take the entire marketing function and keep it in ABT for the following reasons. We examined the possibility of assigning some marketing functions to Forbairt. I referred to this earlier by saying it be up to a certain threshold or a certain size or in certain activities. The experience on the ground is that companies in our open economy very quickly and, indeed, in some cases from day one get into export marketing. We looked at the possibility of having a marketing function specifically for the domestic market and involving ABT when people started to export and, frankly, the Minister, Deputy McCreevy, and I were looking at a bureaucratic nightmare. We decided that we had been given a decision, we had a separate Department of Tourism and Trade and a separate ABT and that there was enough to do in terms of integrating what exists at present. We decided to keep the marketing function in legislative and legal terms exclusively under the umbrella of ABT but to ensure that the ABT people worked hand in glove with the Forbairt people, in many cases out of the same building.
If I accepted Senator Quinn's amendment, I would effectively introduce a hornet's nest from a bureaucratic point of view because I would reintroduce the possibility that Forbairt could start to introduce marketing programmes which would compete with the current marketing programmes at ABT. This is the reason I cannot accept the amendment even though there is some strength in the argument. This is an attempt to bring together certain components that already exist in the most efficient and effective manner and I think we found the best way of doing that. Senators refered to providing support for entrepreneurs. Increasingly it will be the policy that applications for grant assistance for setting up companies will only be available if, in some cases, the person who wishes to set up the company has completed a start your own business type course. The statistical evidence seems to suggest that the survival rate of a person who has participated in such a course is higher than a person who has not, regardless of how good their idea is or how enthusiastic they may be.
I wish to refer to the Minister's final point. In a number of cases, the entrepreneurs who have been successful have not participated in courses of any description but they know where to find expertise. There is no point suggesting that half the entrepreneurs in this country would have benefited from a course run by people who were never in business but who supposedly have marketing skills and degrees. That does not happen.
Senator Hillery has been involved in post-graduate business studies in UCD. The UCD marketing practice course has been enormously successful. Entrepreneurs, not all of whom went to college, gave the lectures. Jobs were provided for people from the College of Commerce, financed by the State and by the entrepreneurs. Malachy McCluskey is considered to be a tough person in business.
I ask the Senator to refrain from naming people who are not present.
He brings in expertise where he can. He has been successful because he uses the expertise of the universities, the only university he attended was the university of life. The Minister should not try to stultify people who want to get into business by saying they must do a course especially if they want a grant from the Government. About 90 per cent of people who want to set up in business will fail but FÁS courses do not produce entrepreneurs. Such a suggestion is ludicrous.
I do not think it will do them any harm.
That is for sure.
I take the point that it is not a precondition of entrepreneurial success that one has been formally trained and there are many examples of that. Nevertheless I do not think attending such course can do any harm, and it may add to a person's entrepreneurial flair.
The amendment relates to a point we discussed in detail earlier. The Minister said that when he spoke with the Minister, Deputy McCreevy, it was decided there would be a bureaucratic nightmare if a proposal of this nature was visited upon us. The point is that the bureaucratic nightmare would not arise but for the original decision to compartmentalise the functions in two Departments when they more appropriately lie within one Department. I do not suppose we can solve that problem within the scope of the Bill.
It took a month to decide it.
The Senator is right about that.
I doubt if the Minister can come back to us on Report Stage and say the two Departments have been amalgamated and he is prepared to accept the amendment.
An amendment to reduce the Government by one. Which one?
We could all assume who that would be but I am sure another Department could be created to look after the casualty. The difficulty has arisen because of the first error and it is not right to say that this cannot be rectified because of the first error. The bureaucratic nightmare has been created by the error of creating the two Departments. The fundamental point still stands that the marketing function should be promoted and helped through the legislation, and that is what we are attempting to do.
I will not press the amendment on the grounds the Minister has outlned. The point is a fundamental one and I admit that in proposing the amendment I was of the opinion that marketing was being downgraded. It clearly has been thought through by the Minister. The fact is an Bord Tráchtála continues to exist and its function has been recognised. The Minister used the terms "the hornet's nest" and the "bureaucratic nightmare". I do not know what happens when hornets have nightmares but it would be horrific. I agree to withdraw the amendment on those grounds.
We recognise the central importance of marketing. I think we got the formula right but only time will tell. It will be for either myself or others to recognise and to monitor what is happening and to correct it accordingly.
I must respond to what Senator Lanigan said in relation to the need for training. There are two important points in this respect. I have never yet met a graduate from the university of life who did not want their children to attend university full-time. The higher the first class honours from the university of life, the more desiring they were that their children would participate in a course.
We should send them all to Senator Hillery.
I have no objection to people failing in business, no matter how many times they try, if they are using their own money. What we are talking about here is people getting grants from taxpayers' money to have a go at being successful in business. We have an obligation, if it is taxpayers' money, to ensure that these people are best prepared to maximise their prospects for success and to minimise their prospects for failure. It is in that context that that point was made.
Amendment, by leave, withdrawn.
Amendments Nos. 5 to 8, inclusive, not moved.
I move amendment No. 8a:
In page 5, lines 12 and 13, to delete paragraph (d) and substitute the following paragraph:
"(d) establishing regional boards."
This amendment concerns the establishment of regional boards under the Forbairt structure. When I tabled these amendments, I had the problem already referred to by Senator Lee, concerning which body dealt with the Irish and which dealt with the international part of the equation. I am not suggesting that every word of every sentence in the Culliton report should be written on tablets of stone and fully reflected within the ambit of the Bill. However, there is a recommendation that the new agency for industrial development should operate through a system of regional boards appointed by the agency. There is an even more pressing need for that now than when Culliton wrote the report.
With the proposed establishment of the county partnership enterprise boards, I could envisage a situation where one board would grant assistance to an enterprise and that a similar enterprise, five miles away in another county, could be grant-aided by its board. This could result in an unsatisfactory competitive environment, where it is conceivable that one or even both developments could fail. While I am, in principle, opposed to extra layers of bureaucracy, which is why I put down the earlier amendments about Forfás, I accept the point. The Minister already referred to the need for co-ordination and if that co-ordination is to be effective a regional structure is needed, which is why the amendment was tabled.
Amendment No. 12 to section 10, the introduction of the word "regional", is similar to this amendment, and I will discuss it now if it is acceptable to so do. As Senator Dardis outlined, if the 36 county partnership enterprise boards are established, which it seems they will, and there is no co-ordination——
Amendment No. 12 is not being taken with this amendment and will be dealt with separately.
In that case, I support Senator Dardis's amendment on the basis that we need co-ordination, although directions can be given by the Minister's Department. We do not know how the county enterprise boards will work. An easy solution would be for the county managers to meet and discuss the issue and come to a decision but that is not what Senator Dardis or I have in mind. I would like to think that we will have a level playing pitch with regard to co-ordination. Yesterday Senator Mooney mentioned the proposal for a special tax free zone along the Shannon. We could look for similar facilities along the Boyne or elsewhere——
Or the Nore.
The Government will decide, at the end of the day, where most seats will be gained by either party as a result of that policy.
It would never be motivated by such considerations.
The Minister should return to the hangars in Aer Lingus, then we might have different results.
If one is in trouble, the nicest place in the world to be at this time of the year is the Nore-Suir valley.
Not in the hangar anyway. This matter should be dealt with and I support the amendment.
The amendment refers to regional boards. I wish to ask the Minister about a matter which is concerning me in relation to this discussion. I was not here for the Minister's reply last evening, for which I apologise. I am not sure if he dealt with a query which greatly concerned me, and which I raised on Second Stage. Will the Minister outline where, what could be described as existing regional boards, will fit into the proposed structure?
I know that sections 7 and 8 at least impact on this but how, for example, do the functions of Údarás na Gaeltachta and Shannon development fit into this scenario? Neither of these bodies was referred to in the Minister's speech on Second Stage or in the legislation but they exist and in many cases perform a worthwhile function. However, they have a system of operation which will impinge to a degree on what is proposed here. I am sure there is a master plan within which everything dovetails but, for the sake of clarification and ease of mind, will the Minister indicate how they fit into the proposed arrangements?
To take this further — I raised this on Second Stage — where will the county partnership enterprise boards fit into this? It cannot be ignored that the boards set up under the Leader programme also have a function. I do not want to say that it conflicts but it must fit into this arrangement somewhwere. For my own peace of mind and for clarification purposes, I would appreciate if the Minister could deal with it.
I do not know what these boards will do. With respect to Senator Dardis, the proposal to establish the regional boards in the context of section 7 would mean hoping that the redrafted section will take on board Senator Lee's point that it would be for indigenous industry, that these regional boards would then only have the capacity to deal with indigenous industry as required under section 7 and would have no hand, act or part in dealing with any development of industry coming from outside the State. That is illogical.
If there is a case for regional boards— and I am not convinced of that because the country is too small — they should deal with both aspects of development. If these were established under the aegis of Forfás or one of the other agencies, how could that be achieved? Would they be responsible for Forbairt or Forfás? I am not conviced that it would have a function. If the proposal had been included in section 6, which deals with the functions of Forfás, it would have been logical and the argument would be whether we needed a regional authority to deal with the boards. Its inclusion in section 7 means they will be constrained to deal only with indigenous industry, for which Forbairt is responsible. I am not sure that would fulfil the purpose outlined by Senator Dardis in his proposal.
I share Senator Howard's concerns about SFADCo and I referred to that concern on Second Stage. There is no specific reference to SFADCo or to Údarás na Gaeltachta so I would like to hear the Minster's response to our concern. The Minister said earlier that we are dealing with existing agencies and certainly SFADCo has been an affective body in the past.
If we delete paragraph (d) as proposed in the amendment we will limit, to some extent, the scope of the Bill. That would be a mistake as it would remove some of the flexibility in the legislation.
I am a strong supporter of regional development and, if necessary, of regional boards. I do not think, contrary to Senator O'Toole, that we are too small for such boards although sometimes there are reasons for not setting them up.
I have a problem with the specific proposal because the function of regional boards should not be to do locally what is done effectively at national level. The persective ought to be different. Senator O'Toole referred to the possible relationship between Forbairt and IDA functions locally. In so far as there is any chance of that pious aspiration of integrated planning then the function of regional organisations should be to try to bring an integrated perspective to bear from a local or regional viewpoint. There is perhaps a better chance of doing so at local level than at national leve where there is a sectoral allocation of responsibility. As the Minister said, these agencies cover only part of economic activity.
We do not know how to devise regional boards which try to integrate assistance to inspire regional development. Maybe nobody in any country knows how to do it. It is a serious conceptual and practical challenge with a host of political and other problems. It is something well worth trying. We must try to achieve it but replicating, at a regional level, the proposed national organisations will not necessarily advance it, it may well impede it.
I am flexible on this matter and I accept some of the points made. I await the Minister's response. However, the amendment is more relevant to Forbairt as it applies to the fostering of local enterprise. I realise that the county enterprise boards comprise a structure which might be appropriate to this function.
We do not know that.
No, but at least there is a proposal in that regard. It will deal with local enterprise. The other agency is primarily seeking large international investment where the issue is whether the investor will locate in this country or elsewhere. The regional aspect does not have the same degree of importance. We could broaden the subject to a wider argument about EC regional policy and whether Ireland is appropriately one region or several sub-regions. However, that is a debate for another day although it is a related matter.
I wish to refer to a number of points. The IDA currently has the power to establish regional bodies and to operate on a regional basis. We are taking the current powers of the IDA which we have the power to do under previous legislation. I have no problem in accepting the thrust of the amendment to section 10 on which Senator Farrelly spoke. At the bottom of page 5, subsection (2) reads: "Forfás and either Agency may, as it thinks proper, from time to time constitute committees or other bodies (including regional bodies)...". If the Senator wishes to make "regional bodies" explicit in the legislation I do not have a difficulty as it does not change the thrust of the section.
Some points in this context were raised by Senator Howard. SFADCo has been uniquely responsible for some remarkable achievements in the Limerick region and in Limerick city. I was in Limerick last Friday and I saw, with a certain degree of envy, the flexibility with which the Limerick city manager could deal with problems experienced by every city and town.
I have a great regard for the integrated developmental capability of SFADCo and, as the Senator will be aware, that organisation is responsible to my Department. That body will remain intact as the operational regional development authority for that area and will continue its current work. Therefore, it will not duplicate the work of Forbairt and Forbairt will not encroach on SFADCo's territory. The international dimension that will be undertaken by IDA (Ireland) and which is not currently the remit of SFADCo will be done by the IDA working closely with SFADCo. The same will apply in principle to Údarás na Gaeltchta although I do not have the same degree of ministerial responsibility and I cannot be explicit in that regard.
I can be explicit about regional co-ordination. The county enterprise partnership boards are, by definition, county based and delineated by the boundary of the county. The new regional authorities, recently agreed to by the Cabinet on the proposal of the Minister for the Environment, are amalgams of counties. They do not breach county boundaries and, to that extent, are integral.
I am happy to accept the proposal from Senator Farrelly that any regional structure established by Forfás or Forbairt — it will effectively be Forbairt — will respect regional boundaries. Members of the House will be familiar with the voluminous writings of Professor Barrington which date from about 1972 on the harmonisation of different regional boundaries. I undertake that, in so far as the Department of Enterprise and Employment has responsibility for the regional boundaries of Forfás and for the new regional boundaries that may be established under Forbairt, the boundaries will be the same. We will align existing regions to those structures as closely as possible to achieve the required harmonisation. Other Government Ministers have also decided in principle to try to align their regional operations in that way, on the understanding that the establishment of a regional structure, as Senator Lee pointed out, is only of value if it can do something innovative at local level that cannot and is not being done at national level.
We have made good progress on this matter. However, I feel a little lonely as amendments from my colleagues have been accepted and mine seem to be excluded.
They would be accepted as a Fine Gael amendment to a Progressive Democrats proposal.
This was a symbiotic arrangement rather than a deeper association. The Minister accepts that the regional boundaries for all these agencies should be coincidental and this is important. He also accepts that our boundaries are very confusing. It is also important to keep the county boundaries intact. County Offaly, for instance, is divided in two, which does not make sense. From that point of view we are making some progress and the Minister's reply goes some way towards reassuring me on the matter.
Amendment, by leave, withdrawn.
Amendment No. 9 not moved.
Acting Chairman
Amendments Nos. 10 and 11 are related and may be discussed together.
I move amendment No. 10:
In page 5, paragraph (d), line 13, to delete "Minister.", and substitute "Minister, and".
We have already discussed the main thrust of this amendment and I indicated I had misplaced it. It deals with the reordering of section 7, which the Minister has indicated he will deal with on Report Stage. I will leave it to the Minister's officials to bring this amendment forward. I am happy the Minister accepted the principle behind it and I fully appreciate the generosity with which he has approached the matter.
I wish to make one further point, one that has been made by Senator Lee, that it should be very clear that indigenous industry is what is referred to in section 7. The phrase "in the State" could be taken to mean indigenous but, as Senator Lee has pointed out, the phrase "in the State" is used in other sections as well. Some distinguishing feature is needed in section 7 to indicate that that section deals with indigenous industry.
There is broad agreement on what we are trying to do here, and I am happy to withdraw amendments Nos. 10 and 11. The point has been made and the Minister has accepted that it will be redrafted. I am confident the redrafting will encompass all the points raised here and I ask that it might also cover the points raised by Senator Lee, which are not there by way of amendment, that it should clearly indicate that the section is to do with indigenous industry within the State.
As Senators will know, the IDA legislation is confined to certain categories of economic activity. Section 7 is to be rewritten because of the reasonable observations made by Senator O'Toole, but Senators should look at section 8 (a) and contrast it with section 7 (a). The critical difference is to establish development in the State under Forbairt, and under Forfás or under the IDA to "establish development in the State", and then it goes on, "of industrial undertakings from outside the State". That is where the distinction is made. We are leaving ourselves open to the promotion of industry by Forbairt within the State, subject to the constraints of this legislation, and the distinction is made between indigenous industry and inward investment from outside the State as set out in section 8. I am advised by the parliamentary draftsmen that if we try to make more detailed provision for this we begin to complicate things.
The distinction is very clear. Forbairt has responsibility for the promotion and development of industry within the State, and there is a clear distinction between that activity and the promotion of industry brought to Ireland by undertakings outside the State. We are not making any distinction between indigenous companies and foreign owned companies which have already set up here. If a company is here five or 10 years, for example a company like Semperit, which is here 20 years, and if they wanted to diversify or carry out a development work, I would regard that as being Forbairt's responsibility because they are already here, and they will be talking to people already here. It is a foreign owned company; I am not sure if it is a publicly quoted company. It is ultimately owned by Continental, the Germany company. That is why we are making that distinction, and I request the House to leave it that way.
I do not gratuitously offend Ministers or wipe them off the agenda without being deeply motivated. Amendment No. 10 seeks to delete "Minister", and substitute "Minister, and". My amendment should have read ‘delete"." and substitute "and"'. However, I take it that the parliamentary draftsman will tidy that up.
Amendment, by leave, withdrawn.
Amendment No. 11 not moved.
Section 7 agreed to.
SECTION 8.
Acting Chairman
Amendments Nos. 11a and 11b are related and may be discussed together.
I move amendment No. 11a:
In page 5, line 21, to delete "Minister." and substitute "Minister, and".
Amendment No. 11a is the same as that moved by Senator O'Toole in section 7 except that it refers to section 8. The purpose of the amendment is to allow an additional paragraph to be inserted. Amendment No. 11b is to apportion responsibility for promoting overseas investment in Ireland.
The Minister has dealt with some of these matters in his earlier reply and I take his point that section 8 (a) deals with industrial undertakings from outside the State but I had the same difficulty as Senator Lee had in being clear in my mind when I was putting down amendments as to which was which; that Forbairt would relate to indigenous industry and that IDA would relate to industry outside the State. I am prepared to accept that under section 8 (a) the Bill refers to industrial undertakings from outside the State, but there was a certain amount of confusion about it. The amendment was put down to clarify the situation and to ensure that it would deal specifically with promoting overseas investment in Ireland.
I had some difficulty in following precisely how the amendment was to be integrated into the text. We are stating that the main function of the IDA shall be as an agency of Forfás to promote the establishment and development in the State of industrial undertakings from outside the State. The suggestion in this amendment is to include the promotion of overseas investment in Ireland. These are two different things. Let us take the example of a British or American property company taking on the ownership of an existing office block. Not a million miles from here is an office block that was owned by British miners pension fund — I am referring to the Setanta building across the road. Is that the function the Senator is suggesting when he suggests promoting overseas investment? I would not be in a position to agree to the inclusion of the promotion of overseas investment in this Bill, even if I agreed with the Senator, because that is a much wider remit. I would have to go back to my Cabinet colleagues to get agreement for that as it would cut across the responsibilities of other Departments whereas the promotion of industrial undertakings from outside the State in the State is clearly within the remit of the Department of Enterprise and Employment.
Amendment, by leave, withdrawn.
Amendment 11b not moved.
Question proposed: "That section 8 stand part of the Bill."
I looked at section 8 following the explanations the Minister gave in response to some of the points raised yesterday and today and there are a couple of questions that must be answered. IDA (Ireland) deals with foreign industry. When IDA (Ireland) is successful in convincing people to come to Ireland, who decides what sites will be used? Who in Ireland will direct foreign businesses to what parts of the country? Will Forbairt have any say in the matter? How will Ireland as a suitable place to locate be sold?
I have had the opportunity of visiting a number of our agencies' offices in Europe, America and Taiwan. ABT sells Ireland as a tourist destination as well as promoting the sale of Irish products abroad. I thought the new legislation would amalgamate all the agencies selling Ireland as an industrial base or a tourist destination or selling our products abroad. Even though the Minister mentioned there had been amalgamation in some areas, I am sorry to say that on the basis of the information provided IDA (Ireland) is on the seventh or eighth floor of a building in New York and the Tourist Board is located in a different building on the seventh or eighth storey as well. There is no co-ordination. If we pool our limited resources for selling Ireland — and we are all aware of the reductions in funds available to the different agencies over the last five or six years — we would be able to have a greater presence and a more effective team working on behalf of the State.
I am opposing this section because these agencies should be brought together at some suitable date, for example, as and from 1 January 1994. The Minister said these boards have different arrangements for pensions, etc., and I accept that because each organisation does different things at different times it can cause problems when amalgamations take place. I wonder if the Minister, or Ministers because there are two Ministers involved, have had any conversations about making better use of the limited resources available to do a better job of selling Ireland. Let us be honest about it when you visit other countries and see the little offices provided for Bord Fáilte or the Trade Board, you realise we are only a small dot in a huge market. The one thing that always struck me was that we were so small we appeared to be insignificant in real terms.
I feel strongly that when we were introducing legislation, especially when it dealt with policy on what is happening outside the State, we should have put these agencies together in order to make the little dot bigger thus having a greater presence and being more effective in the way we do our business. I still believe that, and I do not think we are dealing with the problem here. I know that the Minister and Minister McCreevy spent many long hours deciding what should happen but I feel that the opportunity to do a better long term job was missed.
The Senator raised a number of points and let me deal with them as he introduced them. First, he asked how will things function in the new regime. Not much differently in terms of selecting where an inward investment may wish to locate. At present, the IDA has a regional structure which is run by a regional manager of principal officer rank, and two people of AP rank, one responsible for indigenous industry, the other for overseas industry. Essentially the Forbairt network would remain intact, taking over the IDA network, and the IDA inward investment person — depending on the nature of the product, commodity or activity — would bring prospective investors to those parts of the country they would like to look at from the point of view of maximising efficiency, their location and their return.
As I understand it, the IDA can encourage industry—and did so by offering slighlty higher grants when there was a policy of discrimination, for example, against Dublin — to other parts of the country. This, in my view, happened due to the erroneous perception that Dublin was doing all right. There were higher levels of grant and support of that kind, but the IDA did not have the power to compel a company to come here on condition that it located in a particular area. It did that at its peril because companies could then say if that was the IDA's choice they would leave, and ultimately the IDA had to back off.
I do not want to reveal the nature of the companies involved, but I know that at present a couple of companies are seeking to locate in location A and the IDA, for a variety of regional development reasons would prefer them to locate somewhere else. The IDA realises, however, that these companies are free to choose because there is open competition and they are responsible for their own economic success.
With regard to what is currently happening abroad and the integration of the various activities, there are a number of ways this can be done, and I have had experience of this. We now have in London a body called Ireland House where ABT, the IDA and Bord Fáilte are located under the one roof and working closely together. I was in London three or four weeks ago with Ministers of State O'Rourke and Brennan and a number of officials from the Department. At the end of the evening we met with representatives of the IDA and ABT — the person from Bord Fáilte, through no fault of her own, was not available at that time — and they spoke of the close co-operation between their organisations. The IDA person mentioned a company that had chosen to locate in Ireland which he had approached on foot of information given to him by the Bord Fáilte representative whose work in the field introduced her to this company because, as Senator Farrelly said, this is a very big market.
That is right.
I would like to put on the record the fact that this achievement was crowned by the active co-operation of our ambassador who was openly working in close co-operation with the three agencies and made the embassy available as a promotional tool for their efforts. The ambassador agreed a programme of targeted, promotional dinners for different industrial sectors which had been identified by ABT or the IDA, and where the cost of the dinner was shared or wholly paid out of the promotional budget of the relevant agency. That is the kind of co-operation that comes about through policy at national level and by personality and collaboration at local level.
The argument against integrating ABT into a single body is that one then begins to interfere to a certain extent with the career paths of different people. There are people who specialise in marketing, such as those in ABT. They are abroad in external markets finding locations for those working at home. While that is selling Ireland it is doing so in a totally different way from someone locating companies that might want to invest in Ireland. One of the bureaucratic problems envisaged was that if an integrated structure was developed between IDA and Eolas, people would move from one side to the other and skills would be lost in the process. A similar effect can be achieved by co-ordinating their activities more closely.
The promotional structure within and between Departments changed when the Top Level Appointments Committee system, or TLAC, was introduced about 1984. Prior to that at senior level vertical, stand-alone pyramids of promotion existed in the various Government Departments. TLAC introduced lateral movement so people could move between different Departments. That has allowed greater movement in the system and improved it.
Excluded from that arrangement was the Department of Foreign Affairs. As a result of the recommendations in the Culliton report, and more specifically in the Moriarty report, the Department of Foreign Affairs is now opening its internal promotion at assistant principal and principal officer level, or first secretary and counsellor level as that Department call them, to other parts of the Civil Service. That should introduce commercial awareness and lateral flexibility. It should also make our embassies more commercially-oriented.
The Minister mentioned the success of bringing the agencies in England together under one roof in Ireland House. I was aware that was about to take place but I did not know it had actually happened. What is the possibility of similar structures developing in other capitals? This should be pursued because it can lead to progress. I will not press for a vote on the section.
We should do that and I hope as the Minister says that officials in the Department of Foreign Affairs begin to look at matters differently. The full potential has not been tapped. Collective responsibility and pooling of resources can result in more people being interested. Through conversations one may hear of a development and ask if it can be checked. It is amazing what can happen. I welcome the response but I hope what has happened in London will be the beginning of what could happen in capitals around the world.
Question put and agreed to.
SECTION 9.
Amendment No. 11c not moved.
Section 9 agreed to.
SECTION 10.
I move amendment No. 12:
In page 5, subsection (2), line 43, to delete "other" and substitute "regional".
The Bill says "Forfás and either Agency may ... from time to time constitute committees and other bodies". I suggest the word "regional" be used there. The Minister is prepared to accept that word and I welcome that. He has recognised the need to organise such committees at different times. Under the new structures and the different regions involved it is important there by continuity between counties in each region. This is a worthwhile amendment and I ask the Minister to accept it.
I ask the Senator to bear with me and allow me to return on Report Stage with the exact text. I am advised by my competent back-up team if I was to remove "other" and put in "regional" I would close off options relatbairt' ing to the national standards authority and other bodies. I undertake to have "regional" in the text but I may have to qualify it in another way.
That is agreed.
Amendment, by leave, withdrawn.
Section 10 agreed to.
Section 11 agreed to.
SECTION 12.
Acting Chairman
Amendments Nos. 12a and 12b are related and may be discussed together.
I move amendment No. 12a:
In page 6, subsection (1) (a), line 23, to delete "£2,500,000" and substitute "£5,000,000".
This concerns the amounts of money that can be spent without prior permission from the Government. How long have these figures been extant? They date back some time.
They date back to 1986.
I thank the Minister. Therefore, it is appropriate to re-examine them. I have an incident in mind. The Oireachtas Members involved are not here to defend themselves so I will not name them. I have reprimanded Senator Daly for mentioning people who are not here to defend themselves so it is consistent that I not do so either.
In his reply to an Adjournment debate last night, the Minister said we should not seek by political means to intrude or undermine ongoing negotiations between the AID and an investor. I agree with that. I know he said it in respect of an individual. I could apply it to the other person involved in the argument.
The amendment intends to remove the possibility that projects coming into the country be damaged, endangered or withdrawn by virtue of someone going to the local press and saying a project is coming to his or her area. A sum of £2,500,000 is a large amount of money but it is not an especially large investment in an industrial context. It would be better to allow the agency to deal with these matters.
The Minister last night also said an agreement between the Government and this particular company would follow an agreement arrived at with the IDA. Does this mean the Government make the agreement with the investor rather than the IDA? To be consistent with what has been said on Second Stage of this Bill and subsequently, it would be better to let the agency deal with the matter up to quite significant levels, such as £5 million, rather than having to refer it to Government. There are many dangers inherent in that, although there may be advantages.
I understand the Senator's intention to be to give some flexibility and to avoid adverse publicity which could affect the safe negotiation of a project. It is a well-meaning intention but I do not necessarily think raising the threshold to £5 million will achieve that objective. The origins of this, as I indicated in my intervention, are in the Industrial Development Act, 1986. It says anything above that sum must be brought to the Government for approval. It is a second chance to examine a proposal, largely because taxpayers' money is involved. It is not venture capital being freely offered by the IDA as if it was its own money or indeed depositors' money given to it for that purpose. This figure has been negotiated and agreed by the Department of Finance and I do not have the authority to acceed to proposals to raise the threshold. It is a substantial amount of money over which the IDA can exercise autonomy. Where it is proposed to spend any sum above £2.5 million by way of grants, such proposals should be presented to Government for clearance.
To answer the Senator's specific question, the agreement, for the sake of a contractual agreement, is between the IDA and the inward investor. This is in so far as there is a written agreement which is now usual. It is a conditional agreement. The money is drawn down on condition that agreed job targets are met. If they are not met, then the pro rata amount of money is not paid. The Government gives its approval to the IDA to enter into such an agreement above £2.5 million, the threshold figure.
Referring to the Adjournment debate in the Dáil last night which I had to attend, there have been occasions recently when, because of the wide numbers of people involved in these negotiations, information has circulated from different sources. Senator Farrelly referred to the situation were, when a site is visited, people develop an interest and quickly acquire information. Therefore, the suggestion by Senator Dardis, that in raising the level to £5 million this situation will be avoided, does not equate with our experience. In addition, given that it is taxpayers' money, £2.5 million is a substantial figure.
I agree with the Minister that it is a substantial figure. However, many investments would be above that level. I hope the Minister agrees, that I have been moderate in the tone of my intervention on this matter.
I agree.
It is not my intention to cause a heated debate on the subject. Perhaps the Minister accepts it is desirable to limit the number of persons to whom information of a sensitive nature is available and that — as in the case of the Cabinet — there would be restrictions on such persons as to what they may do with this information. That is the purpose of the amendment.
There have, of course, been politicians who acquired information, not from members of the Cabinet but from other sources and who have used such information responsibly in the knowledge of the consequences that could arise if they publicised it. They have suffered the consequencies. This amendment attempts to level the playing field between Members of the House.
Amendment, by leave, withdrawn.
Amendment No. 12b not moved.
Section 12 agreed to.
SECTION 13.
Acting Chairman
Amendments Nos. 13 and 14 are related, amendment No. 15 is consequential on amendment No. 14 and, therefore, amendments Nos. 13, 14 and 15 may be discussed together.
I move amendment No. 13:
In page 6, line 31, to delete "prepare a" and substitute "commission an independent".
If amendments Nos. 13, 14 and 15 are accepted, section 13 would read as follows:
The Minister shall, within three years from the passing of this Act, and in every third year thereafter, commission an independent review of national industrial performance in the previous three years and shall prepare a review of national industrial policy and shall cause both reviews and the conclusions arising therefrom to be laid before the Houses of the Oireachtas.
The object of this amendment is to allow the Department of Enterprise and Employment to concentrate on reviewing policy and to hive off the review of performance to an independent company which, I believe, could undertake the task more cost effectively.
In addition, if the review of performance is undertaken independently it will give reviews of policy more authority and greater credibility. The review policy will be on independently based facts and there will be no suspicion that facts would be selected to support a particular policy approach.
I make this proposal in the light of the reviews of industrial performance in the past where those have read them agree that the task would have been better executed outside the relevant Government Department. Therefore, in line with the Culliton report, the focus of the Department should be kept on policy formulation while an outside body should review performance.
I cannot accept this amendment. The text of the relevant part of the section reads: "The Minister shall, within three years from the passing of this Act, and in every third year thereafter, prepare a review of national industrial performance ...". I stress "performance", not policy. In effect I wish to bring back policy formulation to the centre of the Department of Employment and Enterprise, as I stated earlier. Policy is formulated initially within the Department and then within the Cabinet and from there through the Houses of the Oireachtas. It is then given to Forfás and the two executive agencies to implement.
The performance of the implementation of that policy is a legitimate matter for those involved in its formulation. I have no difficulty with an independent review or commission operating simultaneously. An example is the evaluation by the ESRI of the benefits obtained from spending the previous allocation of EC Structural Funds.
However, if it was required that an analysis and review of performance should be undertaken, not by the Department but by independent bodies, two main objections arise. First, it would not be cheaper as we will have to commission people and pay fees as distinct from having our own people, who are already on the pay roll. Secondly, those already employed in the Department should be intimately involved in reviewing how their policies are implemented because they will learn how relevant and practical they are when formulated in Kildare Street as distinct from having to be implemented in the real world.
The Senator's amendment would remove this central plank of the new Department of Employment and Enterprise, which I am sure is not his intention. They will not be good policy makers if they do not understand the constraints involved. Collectively, the Minister and the policy formulators in the Department should be obliged to monitor the effectiveness of that policy as implemented and learn the necessary lessons.
This is not to deny a role for independent commissions. However, I am unable to accept the Senator's amendment in the circumstances. It would be a strategic mistake.
I understand the Minister's point and I accept that the Department must review the performance of the bodies it controls. However, it would be beneficial if that review was undertaken by a body other than those formulating policy. I urge the Minister to consider this as there should be an independent examination of performance other than by the controlling Government Department.
I accept what the Senator is purporting to do. However, I suggest that the Houses of the Oireachtas are the appropriate bodies to make an independent analysis where required. If the reform of the Oireachtas structures currently being implemented proceeds and committees of both Houses are established, I and my successors will be required, under section 13, to publish a review. The annual reports of the three bodies will provide statistical information. The normal statistical data will be available to Members and to the public. A triennial review will be published by the Department of Enterprise and Employment, under the Minister's signature, which must be brought before these Houses.
From cost-effective, political and independent points of view and the array of expertise available, this group of people are now in a better position, as a result of the reform of the Oireachtas, to critically analyse the implementation of policy. If these committees decide that an in-depth analysis is needed to ascertain the reason this did not work, but they do not have the time or expertise to carry out this study, then there is no reason as Members of the Oireachtas, they cannot propose that the ESRI or an independent commission do it instead.
I must repeat the words of the former chairperson of the Committee of Public Accounts, Deputy Gay Mitchell, who said that if there had been a more investigative committee structure in this House, we would not have had to set up an expensive inquiry in another part of this city. It should have taken place in this building.
I am concerned about this matter because the Minister has inherited an unsatisfactory situation. He is trying to improve it by means which he candidly — and to me reassuringly — accepts are not ideal because we are living in the real world. We adapt to changing circumstances but we should not have to wait three years to publicly review policies, although I accept there is no ideal time to do this.
A three year review was carried out in December 1990 by the Department of Industry and Commerce. This was a good review because it was detached from the self-image of the IDA. At that stage the Department was aware that policy making had moved to the IDA. Therefore, it was commenting on the IDA as an independent observer.
Now that the policy making function of the Department of Enterprise and Employment has been enormously strengthened, it is asking it to review its own performance. Given that this is coming in the aftermath of a Bill which the Minister introduced, it is demanding a capacity for self-criticism which is unreasonable. It would be different if a new Minister was appointed. However, one hopes that there will be stability and continuity for the period involved because it would be unfortunate if there was chopping and changing of Ministers at this time.
We are asking the Department to review not only the performance of the three agencies, but also its own performance. There is no point in saying that policy is its performance. I do not know if outsiders will do a better job, but one should not leave matters to accumulate for three years and then produce a report. There should be an ongoing process of evaluation, both of itself and of the agencies being established.
In the meantime, what type of evaluation process will be in place? There will be the annual reports of the three agencies. However, what will they consist of? People always present the best case for themselves. Each of these three agencies will present the best case for itself. It will be difficult for these agencies, especially Forfás which have overall responsibility, to say that one is performing better than the other. It is not part of human nature to set up criteria of relative performance. I suspect that the annual report of the three bodies for the next three years will be singularly unhelpful for serious evaluation.
The three year review is the only document which might have a degree of independence. However, as a result of the increasing importance attached to the Department of Enterprise and Employment, it will make it more difficult to be independent. The Minister of State at the Department of Enterprise and Employment, Deputy O'Rourke, said last night that if things went wrong Ministers would have no difficulty beating their breasts. I wonder what the Minister thinks about that because I do not believe that Ministers should beat their breasts. If this happens, matters will have deteriorated considerably. Mechanisms should come into play to avoid reaching this stage.
I presume that the three year review, which would presumably have taken place under the previous legislation, will not take place this December. This means that there will be no review in the Department from December 1990 until December 1996. Given the importance of monitoring and evaluating the ongoing developments and the evolving relationships, some mechanism should be devised which allows one to pass an informed judgment at an earlier stage.
I support Senator Lee. I wish to comment on the Minister's reference to the Oireachtas sub-committees. I do not have a lot of experience, but it seems to me that they have not worked satisfactorily and that there is, to a certain extent, a hope they will work in the future.
I accept that.
It is dangerous to rely on this hope. There is a need for independent assessment and for an outside body, other than the Department of Enterprise and Employment, to examine the Department. It is difficult to be one's own jduge and jury. I urge the Minister to reconsider this matter in the light of the argument that it is not right for someone to examine their own performance.
I cannot accept the argument because I am not convinced of it. I will explain the reason. First, I wish to mention the frequency of evaluation and review to which Senator Lee referred. The three bodies will publish annual reports. Forfás will have a one-step removed evaluation of the performance and the delivery of policy by the two executive agencies on the ground. It is my policy, and I introduced it on a previous occasion in the old Department of Labour, to have an annual report of the Department of Enterprise and Employment. I hope we will be able to introduce this coterminous with the day the Department will be fully established, which will be the end of January 1994. That is my aspiration; I am not making an explicit commitment. However, I am making a commitment that there will be an annual report of the Department of Enterprise and Employment. This will cover the entire range of activities of that Department. I hope it will be completed in the first 12 months.
Part of the overall report of that Department must have regard for industrial performance. The triennial review will then be prepared by people in the Department, working with a Minister whose signatures must appear on the review. The review must be brought before the Houses of the Oireachtas and how they choose to deal with it is a matter for them.
The select committees in the Houses of Commons, for example, are elaborate congressional type hearings and are not comparable in parliamentary terms, as the Executive has a different relationship with the House of Commons from that of our Executive with the Oireachtas. Nevertheless, the principle is similar.
The people who prepare a review and the Minister who signs it do so in the knowledge that it will go before a body of expertise and manifest independence who are opposed to the Minister from a party point of view and in some cases, from an ideological point of view. This combination will remove the temptation to write a glossy cover-up type document and will meet the Senator's requirements for objectivity and independence in a cost-effective way. The other way is not cost-effective. It is an additional cost.
Returning to the first point I made, I want those developing and promoting policy — there was a policy vacuum created over time in the Department — and who are not yet all in place as we have not yet completed the internal restructuring of the Department of Enterprise and Employment, to be involved in reviewing how effective their policy was in terms of performance on the ground, and to be open, through the political accountable process, to hearing the criticisms and no more vociferous criticism will be made than by this body.
I want to make a final point which one could make about all consultants, and I have been in that category myself. The independence of a body commissioned by a Department, who is paying the fees, is somewhat questionable on occasions. There is no guarantee that simply because one pays an outside body a substantial fee one will get an independent and, by implication, critical review.
I hope Forfás, being one step removed precisely because it does not have executive responsibility, will be able to stand back and criticise as appropriate, but we will have to see how that works in practice.
I strongly favour the Minister's intention to publish an annual report. I have found the annual reports of the Department of Labour extremely valuable. There could be real value in ensuring that time would be allocated by the Government to have these reports from the three agencies debated in the Houses of the Oireachtas.
For several years I was a member of the Oireachtas Joint Committee on Commercial State-sponsored Bodies and the existence of the committee acted as a discipline for the various bodies in that they had to account for themselves in public to the committee and some valuable work was done there. My complaint however is that far too little opportunity was given to debate those reports in the Houses of the Oireachtas under successive Governments — that was particularly true in the Dáil. If the reports came before the Houses of the Oireachtas as a mater of regular practice we, collectively, could act as a review body on those reports and the relevant time in the Houses or in Special Committees could be allocated as a further check on the performance of the Department.
Amendment put and declared lost.
Amendments Nos. 14 and 15 not moved.
Section 13 agreed to.
Sections 14 to 21, inclusive, agreed to.
FIRST SCHEDULE.
I move amendment No. 16:
In page 7, paragraph 1 (2), line 36, after "land" to insert "and other property".
The purpose of this amendment is to allow the bodies to own property other than land, such as factories and office buildings. I do not see why it should be specifically restricted to land, although perhaps there is a detail I am not aware of.
I am advised that "land" includes property for the purposes of definition but I am happy to accept the amendment.
Amendment agreed to.
An Leas-Chathaoirleach
Amendments Nos. 17 and 20 are related and may be discussed together.
I move amendment No. 17:
In page 8, paragraph 2 (5), line 7, to delete "Minister for Finance" and substitute "Government".
The purpose of this amendment is to put the responsibility where it should be, with the Government and not with the Minister for Finance. I do not understand why the Minister for Finance should have to approve the appointment of board members. That should have nothing to do with the Department of Finance, except from a money point of view, and that is dealt with in another section. I may seem to be a little paranoid about the mandarins of Merrion Street but this is a clear case of their getting involved where, I suggest, they have no business being involved. The procedure should be that the relevant Minister makes a selection of board members and puts them to the Government for approval. I suggest we keep the Department of Finance out of this.
I do not think there is an office holder in this or any previous Administration who would not agree with the sentiments expressed by Senator Quinn. However, let me explain why it is there is the first instance. Every organisation needs a credit controller or financial director and, in a sense, the Minister for Finance is included in paragraph 2 (7) of this Schedule in so far as the clause "on such terms and conditions" covers the level of remuneration. Paragraph 2 (7) reads:
The Chairperson and other members of Forfás and of each Agency shall hold office [that is clearly a function in terms of the selection of the office holders for the Minister, in consultation with the Taoiseach and the Tánaiste, which is the practice in Coalition Governments] on such terms and conditions (including remuneration) as the Minister, with the consent of the Minister for Finance, shall determine.
For a while there was a separation of the functions of public service from the Department of Finance and a Department of the Public Service was set up for a period of about ten years, but for one period only. There was a Minister for the Public Service, a former Senator, Mr. John Boland from 1982 to 1986, prior to that responsibility for the public service was taken from the Department of Finance and given to the Department of Labour. It was brought back to the Department of Finance in 1987 under a new Administration. Setting terms and conditions is a personnel function and have to be set by somebody.
"With the consent of the Minister for Finance" is a standard provision in and the reason it is inserted here is that different Ministers would set different terms of remuneration for different boards and an unholy mess might arise as a result. The Minister for Finance has no say in the composition of the board or in the terms of the personalities involved other than in his or her capacity as a member of the Government. Setting the terms and conditions is a personnel function, effectively.
Amendment, by leave, withdrawn.
I move amendment No. 18:
In page 8, between lines 10 and 11, to insert the following paragraph:
"7. (1) The Minister shall, in appointing members to each Board, ensure adequate representation of both genders.
(2) The Minister shall, in appointing members to the Boards of Forfás and Forbairt, ensure that the experience and expertise of small companies and service companies are adequately represented.".
The purpose of the amendment is to set in stone certain key guidelines for the selection of board members by future Ministers. The first point about ensuring adequate representation of people of both sexes does not need arguing, but the way I have phrased it is aspirational. It does not lay down a specific number of members of each sex. It is merely a reminder to a future Minister — I am sure there is no need to remind this Minister — to take this factor into account.
The second point is different. I am seeking to build on expertise and experience of particular kinds. The Minister will agree that when boards were put together in the past, the two groups I mentioned, small business and the service industry, tended to be overlooked. The boards of Forfás and Forbairt need to have the experience of small business represented because it must play a vital role in our future development. If we want jobs we cannot continue to ignore the potential of small businesses, such as family businesses or business that is created by one person. The experience of small business and its needs and problems are quite different from the needs of other enterprises. This particular perspective should be represented at board level in those agencies. As I stated already, this is more to remind future Ministers rather than necessarily the present Minister.
It is similar in the case of service businesses. We have been bedeviled in this country with a fixation about manufacturing industry, despite all the evidence that should tell us that is not where future jobs will be held or created. Future jobs will not necessarily be created only in manufacturing industries but throughout the world jobs are being created in the service industry. Again, the needs and problems of service industries are different from those of manufacturing industries and that perspective should be reflected at board level.
If we do not put these requirements into the legislation these two important areas will be overlooked when the boards are being put together, perhaps not this time but at some point in the future. I suggest that will cost us jobs in the long term.
I support the amendment. I have no problem at all with the first point and I intend to deal with the second. If one examines the composition of the majority of the boards appointed by Governments in the past, high powered names always feature because of their experience of large companies. If any progress is to be made on reducing unemployment the experience of indigenous industries and small businesses in this country must be included. There are many excellent people who have created small businesses but who do not want to increase the size of their operation because if it gets any bigger they will have to put a management structure in place. I support this amendment because it is very important. As Senator Quinn said, small businesses may be overlooked in the future and if it is decided to include the wording in the Bill it must be taken into account.
If we had details of the total number of people employed in service industries in Ireland, as opposed to manufacturing industry, it would be endent that many more were employed in service industries. However, that sector has always been forgotten. It exists but there has not been much effort to ensure that the views of the people involved are represented. The growth of small companies in Ireland is in the service industry area but it has not received much attention. Many of the people who started such industries were enterprising and that is why I would like a place for them, and the large number of people employed in that area, and their views to be taken into consideration.
Given my lack of success to date with having amendments accepted, I am conscious of the fact that by supporting Senator Quinn's amendment I may be conferring upon it the kiss of death. However, I support the amendment. The Minister is aware that in regard to the county enterprise partnership boards county managers have been given a direction that they must strive for at least 40 per cent representation of men and 40 per cent representation of women. To be consistent with that, the first part of the amendment should be accepted.
I also support the view that people who have experience of small companies could provide a very valuable service. I have some difficulties defining "small", what is the legal definition of "small" and whether it should be small companies and small service companies as well. That is a peripheral point but the central thrust of the argument is valid. People with this experience can be of benefit to the State and the boards and they should be included.
The question of board representation and the knowledge and skills that people have is clearly an important area. In relation to small companies and service companies, I have no difficulty with the spirit of what is intended. Senator Dardis has touched on one important point and that relates to definition. How is it defined? Secondly, we must remember that we are dealing with legislation. It is as near as one can get to tablets of stone and it could be too restrictive to build it into legislation. However, making the point in the presence of the Minister is important and he should be constantly mindful of it.
I wish to support the amendment. It is not necessary for me to outline why I support the first point. It is obvious and we are all in agreement with it. In relation to the second point about the necessity to ensure that membership of the boards will include people who have experience and expertise of small companies and service industries, the establishment of these boards, and what is expected of them is crucial. It is possibly the last chance we may get as a nation to tackle the very serious situation that faces us.
I am anxious to ensure that a high proportion of the board members will be people of proven initiative and enterprise. On boards and in companies where there is a chief executive who possesses much energy and enthusiasm there is often a tendency to put people on these boards whose main function appears to be just to watch and slow him down. There is a serious danger that this would inhibit the very necessary risks that will have to be taken both at executive and at board level. There are people in the categories that Senator Quinn outlined who have the capacity to do what he is seeking and I am also anxious to have them included. I do not for a moment question the sincerity of this Minister and many other Ministers who would accept the point but, unfortunately, Ministers change from time to time and their successors often do not feel bound by the sentiments expressed by their predecessors. There is only one way to ensure that something is taken on board and that is to include it in legislation.
I also support the spirit of the amendment but I defer to the expertise and the advice of the Minister as to whether it can be put into the legislation. The vast majority of indigenous Irish firms are relatively small and the expertise of people in these firms shall be available to the boards.
There is some connection between the two amendments in that women who have started their own businesses, which have generally been small service industries— I presume we are legislating in favour of women rather than men in the present circumstances — have proved to be successful. I do not know if there has been any study conducted on this but one may find that the success of women in this area, in terms of the number who have set up industries, has outnumbered those of men.
Although considerable progress has been made, the final composition of these boards has not been completed. Gender balance and representation of the services and of small industries have been taken into account, but I will not accept this amendment because it is restrictive, for the reasons Senator Hillery outlined, notwithstanding Senator Howard's legitimate admonition.
There is an increasing difficulty in getting members of the public to serve on boards. The media, for example, think that anyone who serves on a board is obviously in someone else's pocket. For small industries and small companies, including service companies — to take the example to which Senator Farrelly referred — frequently the person providing the free consultancy service cannot give all the time needed. It must be acknowledged that time given on most of these boards is not a net cost, in real terms, to the person involved, for which they get free abuse. Given the tightening up in competitive terms which we would welcome at one level, companies have had to reduce their overheads drastically. For example, the spare time those in business or small industry can give to public life is limited. To restrict the representation to the boards in legislative terms would be an impediment for my successors.
I am happy with the spread of representation I believe I will announce in due course. However we have a problem in this country in that the pursuit of politics in the elected form is being increasingly denigrated by people who are paid in multiples of salaries Deputies and Senators receive. That is not confined to people seeking elective office it is affecting those who want to become actively involved in any political party. Everyone involved in politics, be they Independents or members of political parties, recognise that.
Once there was a culture that one put party supporters on the various boards, and some Administrations have fallen into that trap. Later, those who were politically supportive but expert in a certain area and had a contribution to make were appointed to these boards. There is a need to have people who are politically in tune on State boards. In the last six months, I have found that many people appointed by other Ministers, including some of an opposite political persuasion, a delight to deal with because they understood the political constraints upon a Minister. Senator Quinn may recognise from serving different Ministers that the chairperson or member of a board has to understand, although they may not agree with them, the political contracts within which Administrations, who are ultimately accountable to the electorate through the ballot box, have to operate. We are currently dealing with a problem of this kind in Aer Lingus. I cannot accept an amemdment which would impose a legislative constraint on the representation on State boards.
It is Government policy that at least 40 per cent of the boards should have female representation. Until we get this right gender balance effectively means positive discrimination in favour of women. My party has benefited considerably by introducing such a policy of positive discrimination. There are constraints in this area. I am in favour of positive discrimination provided qualified people can be found. I would like to introduce that policy in my own Department. At present there are 22 or 23 principal officers there, but only one is a woman and in the recent round of promotions, there were no female candidates that met the objective criteria and no woman, especially a feminist, wants a woman promoted simply because she is a woman. There has to be a balance of eligibility and qualifications. We will not get a consensus society to gender equality if it is perceived in certain areas, especially where career paths are concerned, that someone is being promoted purely on these grounds. I fully accept the spirit of the amendment but I am afraid I cannot accept it.
The intention of the amendment was aspirational, to stitch into the record the intention of getting a balance. Senator Hillery and the Minister referred to the need to get the best person for the job, and that is by far the most important criterion. On that basis and of the Minister's words in this case, I hope that my aspiration of having both genders represented on boards will come about in future years. I withdraw my amendment.
There are precedents in legislation for this type of arrangement. When An Bord Glas was established, representation from the farming organisations was included in the legislation. I endorse what the Minister said about participation on boards and people in public life. I have said in this House that no one should be excluded from participation in the political process; we have a democracy and it is important that we all participate in it.
Amendment, by leave, withdrawn.
An Leass-Chathaoirleach
Amendments Nos. 19 and 21 are related and may be discussed together.
I move amendment No. 19:
In page 8, lines 17 and 18, to delete sub-paragraph (10).
The same principle is involved in both amendments. The first occasion I was confronted with a similar section in a Bill was shortly after my election to this House and I was taken aback by being requested to support a measure that indicated that I and my colleagues, because we were elected public representatives, were unfit to serve on State boards. I objected to it at the time, but because the Minister was of my own political persuasion and I was a relative newcomer to the House, I did not pursue the issue. I will always recall the reason advanced to me and I hope I do not hear it repeated today, namely that it has always been the practice; in other words, that we should continue to be prisoners of the past, irrespective of the implications. The inclusion of this section in the Bill and I endorse the comments made by the Minister in this regard, undermines the profession of politics. It is ludicrous to adopt a course of action which supports that practice. I have no hesitation in saying I am proud of my profession.
Members of local authorities, the Oireachtas and the European Parliament are disqualified from participation on State boards. The exclusion of elected representatives from participation on State boards implies that they are incapable of discharging the required functions. Furthermore, it implies that elected representatives are more open to corruption than non-elected members. It is unacceptable to disqualify elected representative on these grounds. I have tabled these amendments so as to exclude these offensive sections from the Bill.
I do not believe an elected representative would go to the expense of challenging the constitutionality of these provisions. However, it would be interesting to speculate the outcome of such a challenge. I take grave exception to the inclusion of these sections in the Bill, as I have done in the past.
Professor T.J. Barrington, a former director of the IPA, who was quoted today, spoke about the democratic deficit at a recent SIPTU conference. He said we have an intensely centralised political system that relies on bureaucracy rather than democracy, a reliance that has borne bitter fruit. According to Professor Barrington, Ireland's ratio of elected councillors to population was 1:2,100, compared to 1:1111 in France. He also said:
Ireland has 112 local authorities and 1,633 elected local councillors, substantially fewer than the appointed representatives on the boards of State agencies, but it has long been held that the progress of democracy involved the move from appointed representatives to elected ones.
He spoke about a glaring deficit in decision-making and too little progress. We should not persist with this objectionable condemnation of ourselves and those who elected us.
I do not want to hear the excuse that these sections are included because it has been the practice to do so. They must be removed. Those who criticise and undermine politicians must remember we are the only section of the population who answers to the public. We are rejected or accepted by the people. Nobody is allowed to simply walk through the doors of either Chamber just because we want to, and the same is true of the council chambers throughout the country. If we are to be fair to our colleagues, Members of the European Parliament and councillor members, these sections must be removed.
I also tabled a similar amendment and Senator Howard and I have discussed this matter. I am happy to raise this issue with the Minister because I am aware of his views on this matter. Appointments to State boards should be made on the basis of objective criteria, ensuring that appointees are representative and competent. Having decided on the criteria by which we appointed an individual and having chosen that individual, he or she may be excluded if he or she is a Member of the Oireachtas, a local authority or the European Parliament. That is a contradiction.
I differ slightly from what Senator Howard said. There are certain occasions when there would be a sense of double jeopardy in appointing a Member of the Oireachtas to the board of a State agency that was accountable to the elected assemblies for State funds. However, that is not the case on this occasion. This cannot and should not apply to members of local authorities.
There is a crisis in participation in the democratic process. People do not want to stand for election, they do not see politics as an option. The number of post primary student who list politics as a preferred profession is minimal. I have mentioned this on many occasions and received criticism from Members of the Oireachtas in relation to this point. The profession is perceived by young people as the last refuge of scoundrels and we are to blame for much of that.
There is an element of invidious discrimination in excluding elected representatives from State boards that could be questioned on the ground of constitutionality. Elected representatives such as Senator Dardis and Senator Quinn who have expertise in the retail and agri-industries respectively, could be prevented from offering their expertise to a board who might be interested in hearing their views. Yet, companies assisted by these agencies may appoint board members from any area. This is the only area where elected representatives are excluded from membership. They may be appointed to the boards of any service industry, manufacturing industry, etc.; they are simply being discriminated against in this instance.
I am sure the Minister agrees with Senator Howard when he said that these measures reinforce people's cynical attitude towards politicians. It feeds the prejudice against politicians, that they cannot be trusted or relied upon to do anything and are a useless group of people. On the other hand a case could be made that allowing elected representatives to become members of these boards involves jobs for the boys and girls. It is right that elected representatives, including Government Ministers, should be answerable to such a charge. The simple way of dealing with this is the same way that those of us who are employers deal with recruiting staff. Although I am a trade union representative I also employ many people. We have all been questioned about appointments we have made, we have had to set up objective criteria and give reasons for appointments. It does not make any sense to exclude Members of the Oireachtas and other elected people. Without asking the Minister to breach Cabinet confidentiality I wish to refer to a point made by Senator Howard. Such provisions are automatically included in legislation by the parliamentary draftsman.
It is standard practice.
It is standard in some ways but it should not be standard practice. If there is a clear, understandable case for excluding Members of the Oireachtas and other elected representatives, whether they are Members of the European Parliament or of local authorities, they should be excluded. I am not blaming the draftsman or the Minister for the inclusion of this provision. Such provisions appear in legislation, but we are not trying to change Government policy, neither the Government nor the Department would have made a decision to exclude elected representatives but it happened. I raised this matter time and time again since I was elected to this House six years ago and always find it objectionable.
Sometimes there is a very clear line of accountability which should exclude Members of the Oireachtas. At other times there is a line of accountability which might exclude all elected public representatives. However, there is no case for excluding local authority members who have a proven commitment to their local areas. It could be said that the salary, however meagre, attracts people to become a Member of this House but no salary is paid to local authority members, who have shown a commitment to their local areas and experience all the disadvantages of being elected representatives. I see no reason for excluding them. On this occasion I see no reason either for excluding Members of the Oireachtas.
There is need for a national consensus in this area, this is coming across in every discussion. There should be no exclusivity about our access to talent, expertise and experience in approaching this problem. It is often argued that people who are successful in industry should take an interest in politics; on the other hand we do not want people who take an interest in politics to take an interest in the development of industry. I feel very strongly about this issue, it contributes to the bad public impression of politicians. It needs a very serious response from the Minister and I know he will give such a response.
I support the two previous speakers. In addition to this legislation we are setting up county enterprise partnership boards. A decision has been made by the Government and the Minister that four members from each local authority shall sit on each of these boards. The mould has been broken. Last Monday the local authority of which I am a Member appointed its four representatives. The majority of the Members of this House, who are also members of local authorities, should not be in a position where, as a result of passing legislation, they are eligible to be members of county enterprise partnership boards because of the Government has permitted them to be, but are not eligible to be members of other boards because of their membership of local authorities of the Houses of the Oireachtas.
Last night the Minister of State pointed out that in 1986 a Fine Gael Minister introduced similar provisions, it is quite obvious that this has been the practice over the years. Senator Quinn, if he does not mind me using his name, was chairman of a State board but because he is now a Member of the Oireachtas he can no longer become a member of, or be reappointed to, a State board. It is time that we, as elected members to the Houses of the Oireachtas, did ourselves justice by dealing with this anomaly.
We talk about — the Minister mentioned it ten minutes ago — the way we are portrayed in the media. We have no one to blame but ourselves. We are not prepared to stand up to the realities of life. If we are prepared to go before the general public for election to office we should not be afraid of ensuring that elected people with talent and capabilities are available to serve on boards, this may benefit large numbers of people. We now have a golden opportunity, with a new Government in office, to change the practices of the past and amend this proposal, The fear that the appointment of some people to boards may result in a conflict of interest can be dealt with by regulation, therefore this worry should not arise. Let us stand up for ourselves and for democracy. We see how difficult it is for people all over Eastern Europe to create and develop democracies. As people who are prepared to stand for election we are not prepared to allow the Government to deem us to be ineligible to sit on these boards. I support these amendments.
I understand that this debate will be adjourned at 6 p.m. and I will, therefore, not be able to reply in full to a very substantial point. Let us suppose that during the previous administration Deputy Harney was appointed to the board of Aer Lingus. Would Members like to speculate on the pressure under which we could have come? The natural inclination of Governments would be to appoint Members of the Oireachtas from their own parties to boards. After a change of Government a Member of the Oireachtas who was appointed to the board of Aer Lingus when his or her party was in Government might be in possession of a plan agreed by the board and submitted to the Government. What pressure would that person come under and where would his or her interest and loyalty lie?
If I may continue to use the example of Deputy Harney, because she is very able and has a strong, forceful political personality, would her responsibility be to the board, which has made a collective decision, or to the Minister? The Minister, in his or her incorporeal capacity, would have appointed the Deputy to the board, the person holding the office of Minister may change but the loyalty of board members is to the Minister of the day. Senator Quinn loyally served as Chairman of An Post during the term of office of at least three or four Ministers, in each case he extended the same degree of loyalty and service to the officeholder of the Minister. In such circumstances enormous strain would be put on individual Members of the Oireachtas whether they are Members of the Dáil or Seanad.
We gave an example last night of a member of a local authority becoming a member of the board of Forfás or of the IDA as it is at present constituted and a proposal coming before the board. There is a two-tiered decision-making process in the IDA, the executive evaluates proposals and frequently turns down projects on the basis that the cost is too high.
Progress reported; Committee to sit again.