I welcome the opportunity to return to the House to report on the amendments been made to the Bill since it was first debated here on 15 and 16 June. As Senators will recall, there was at that time a very full and open debate on the matters in the Bill. It was very gratifying that what was essentially an enabling Bill provoked such a wide-ranging and well informed debate on the future of industrial policy. I thank the Members of this House again for the positive spirit in which they approached the debate on the Bill.
A number of issues arose out of the Department's ongoing consultations with the industrial development agencies and the other Departments which have responsibilities in this area and the amendments before the House today are a result of that consultation. They are few in number but they are necessary in order to strengthen, refine and clarify the Bill in a number or areas.
The purpose of amendment No. 1 is to ensure that the existing IDA and Eolas legislation remains fully in force until the new bodies are established. Without this amendment the repeals contained in the Third Schedule would come into force as soon as the new Act was signed and this would deprive the IDA of all powers contained in the First Schedule to the Industrial Development Act, 1986. These include such matters as the composition and powers of the Authority, powers in relation to contracts and instruments and the production of an annual report and accounts. By tying the repeals to the establishment day, we are ensuring that there is a smooth transition between the new and old legislation. In fact, this is plain good housekeeping. It means there will be no gaps, no intervening period, when one wonders who is responsible for what or who produces what. There will be a smooth transition from the old to the new.
Amendments Nos. 2, 3, 4 and 5, relate to sections 7 and 8. They are to allow IDA (Ireland) and Forbairt to administer schemes which involved EC moneys coming from Central Fund direct to the agencies. A feature of the Structural Funds in recent years has been a growing number of Community initiatives which the EC Commission formulates and promulgates itself. Examples include Prisma, certification and training, and Retex, a programme to develop new industry in areas where traditional industries have been in decline. Forbairt and IDA (Ireland) will now be involved in administering these schemes but the funding for them will not come through their grants-in-aid.
Another development under the Structural Funds is the direct co-financing by the Commission of schemes involving a contribution from industry. An example of this is the "Measure 6" industry, research and development scheme under the Department's science and technology sub-programme. In this scheme, grants of up to 50 per cent are paid to companies undertaking product or process development projects. The company contributions is regarded by the EC Commission as matching funds for the purposes of recoupment and, as a result, there is no net cost to the Exchequer.
At present, this scheme is being operated in its pilot phase by a firm of external consultants. Under the next round of Structural Funds, however, the scheme will be administered by Forbairt and IDA (Ireland). The House will, no doubt, be aware the IDA's functions are very precisely specified in the existing Acts and these predate the new Structural Funds regulations. At present there is no provision which would allow the agencies to administer schemes such as those referred to above. The new function will provide this facility.
The inclusion of this new function will also provide a legislative basis to allow the Community contribution to the business innovation fund to be handled by Forbairt. This will allow the IDA to contribute to the seed capital fund operated by the Dublin Business Innovation Centre and will help Forbairt increase its shift from grants to equity as recommended by the Culliton report.
The purpose of amendment No. 6 is to include a reference to the SFADCo Act, 1970 as this delegates certain IDA grant-giving powers to SFADCo and thus needs to be referred to in the new legislation. The text of the relevant section of the 1970 Act is as follows: "4.— (1) ... the Authority may delegate to the Company some or all of such powers as the Authority may have to provide financial assistance to or in respect of an industrial undertaking ... and the Company may exercise any such powers so delegated".
Amendment No. 7 relates to section 12. The purpose of this section is to make Government approval mandatory for substantial capital grant packages in excess of £2.5 million. The types of grants covered by the limit are set out in section 34 of the Industrial Development Act, 1986. However, the grants to which the £2.5 million limit applies are not actually made under section 34 but under sections referred to in section 34 of the Act. This amendment clarifies the position. The relevant sections referred to in section 34 of the 1986 Act are as follows: section 21, fixed assets; section 22, fixed assets which are leased; section 23, reduction of interest on a loan raised to pay for fixed assets and section 24, loan guarantees for the purchase of fixed assets.
The next section which was amended in the Dáil was section 17 which deals with stamp duty. Amendment No. 8 corrects a typographical error which was only discovered after the Bill had been passed by this House. The relevant section is in the Finance Act, 1895 and not 1985 as was originally stated in the Bill. Amendment No. 9 amends the First Schedule. This amendment relates to disclosure of interest and has been moved to strengthen the provisions of the section by covering not just interests in industrial undertakings but all business undertakings. The second Schedule refers to staff.
Amendment No. 10 was moved to satisfy the detailed requirements of the superannuation section in the Department of Finance. Essentially, the objective of the amendment is to ensure that Forfás has the power to prepare and submit new schemes of superannuation, that there is a clear and unequivocal statement that the provisions in the existing legislation governing the superannuation schemes currently in operation — and indeed any new schemes made by Forfás — remain fully in force and that Forfás may amend or revoke any schemes which are carried over from the dissolved agencies. Of course, this would only be done if a new consolidated scheme were being put in place but it has the right to do so.
Amendment No. 11 relates to the Third Schedule. This is related to the previous amendment and provides for the retention of those elements of the superannuation provisions in the 1986 Act which it had previously been intended to repeal. The repeals were originally proposed when the relevant sections were being restated in the new Act. By and large, that is a factual reporting of the amendments — mainly technical in nature — which came through the Dáil. I think the amendments add clarity and sort out matters which were raised in the House.
