Skip to main content
Normal View

Seanad Éireann debate -
Wednesday, 23 Jun 1999

Vol. 159 No. 19

Adjournment Matters. - Factory Closures.

I thank the Minister of State for coming into the House to respond to this matter at such short notice. Job losses inevitably reflect on an entire community, particularly if they occur in a small community like my home town of Drumshanbo. Over the past 15 years that community has suffered significantly from job losses. The House may be surprised to learn that in an area which is perceived as predominantly rural and non-industrial, about 400 industrial jobs have been lost in the town and district of Drumshanbo since 1986. The catalogue of job losses makes sad reading and behind the statistics is the real story of heartbreak and economic ruin in some cases for parents and their children. Sadly, that is the by-product of this latest announcement.

Last Monday afternoon, the 50 or so staff of Leitrim Foods in Drumshanbo were called together by management to be informed that the plant would close and that they were being put on notice. There is hope that some aspects of the product line may continue to be produced or packed in the plant for a number of months, but that is only putting off the evil day.

My main reason for raising this matter was to take the opportunity of conveying to the families of those who have lost jobs my deepest sympathy on what must be a traumatic experience for them. Young and old have been involved in the plant which has a rather chequered history. It opened as a jam manufacturing plant in the 1980s owned by the Laird family to whom the town and district of Drumshanbo owe an enormous debt of gratitude as they were the main employers in the area for over 100 years. The difficult trading conditions in the jam market in the late 1980s resulted in the withdrawal of the Laird family from the plant and it was taken over by another organisation which continued trading until it found it almost impossible to continue. In the early 1990s, Leitrim Foods emerged as a company producing pasta and pasta sauces under the brand name of Cucina, which many people will be aware of in supermarkets and stores around the country. Unfortunately, difficult trading conditions over the past number of months and a subsequent loss of revenue meant that the company found its position untenable, hence the position we face today.

I ask the Minister, with whom the buck stops politically, to direct the Leitrim task force, which is already in operation, to take urgent steps to secure an alternative industry for the town. Ordinarily, I or someone else in this position would call on the relevant Minister to set up the task force but we are fortunate the task force is already in operation. It was set up following the closure of the Ballinamore Textiles factory, 12 miles from Drumshanbo, last year. I am not sure how wide the task force's remit is but I was present with the Tánaiste on the night she promised to set it up and my recollection – I hope the Minister of State can clarify this – is that its remit extended to the entire county rather than to Ballinamore specifically. If that is not the case, I ask that the remit be extended to encompass the job losses at Drumshanbo.

In light of the recent ESRI report which stated there was a real need for more regional industrial development, and the recent comments of Seán Dorgan of the IDA on a reorientation of IDA and Enterprise Ireland policy towards the regions, perhaps the Minister of State can give some hope to the people of Drumshanbo in his reply.

I could be very angry about this matter because it is such a well-trodden path for me. From the day I first came into this House in 1987 I have witnessed job losses in my home town and district. The Mattil shoe factory, which employed 200 people, closed in 1986 shortly before I became a Member of this House. That advance factory has not yet been reoccupied, although there are indications that will happen next month but with a greatly reduced workforce of approximately 15 to 20. Arigna Mines closed with the loss of 150 to 200 jobs. The Laird plant closed with the loss of 100 jobs and the worst blow was the closure of the ESB power station at Lough Allen with the loss of 60 jobs. How long more will this continue? How long more can the people among whom I live tolerate a situation whereby their sons and daughters must leave their county and country? How long more will the haemorrhage of emigration affect County Leitrim, which has the lowest population in Ireland? What hope can be given to those who watch daily reports in the newspapers of a rampant Celtic tiger when at the end of some week in the not too distant future no more money will be coming in to their households? Will the Celtic tiger put food on their table?

I could get very angry about this situation. However, all I can do as a representative in this House, living among the community in Drumshanbo, is to ask the political establishment not to wave a magic wand or produce miracles but at least to give some hope to the people who now face the loss of work.

I thank Senator Mooney for raising this very important issue. As the Tánaiste is abroad, I am taking this matter on her behalf. We share the Senator's concern and disappointment at the decision of Leitrim Foods Limited to close its manufacturing facility in County Leitrim.

Leitrim Foods is a pasta, ready meal and sauce manufacturing facility located in Drumshanbo, County Leitrim. This company was originally founded in 1993 with Kepak as a silent shareholder. After poor performance, Kepak bought the remaining interests and developed the company in line with its own diversification strategy, moving from commodity type products to higher value-added ones.

The company is located in the former 45,000 sq. ft. Laird's jam facility. Leitrim Foods developed a branded pasta product called "Cucina" but still needed to develop more products which would enable it to absorb the overhead of such a large factory. Trading conditions in 1997 were difficult and the company did not generate sufficient sales volume to cover their overheads. The management of Kepak has now decided to divest itself of Leitrim Foods over the coming months.

The management of Leitrim Foods informed Enterprise Ireland on 21 June 1999 that it would cease the manufacturing of pasta, pasta sauce and ready meals as of Friday, 2 July. The company will continue to process their burger product "Rustlers" until September when production will be moved to Gold Star Meats, another subsidiary within the Kepak group.

The company currently employs 55 people – five of whom are temporary – and regrettably all but ten of them will be made redundant next month. I understand that these ten may be kept on until September. A small number may be redeployed within the Kepak Group. The company will continue to trade as Leitrim Foods until September. Enterprise Ireland will continue to work with the management of Kepak to see if they can find an alternative use for the plant at Drumshanbo.

The Leitrim Enterprise Project Group, which was established in the wake of the closure of Ballinamore Textiles to respond to the employment needs of County Leitrim, submitted its final report to the Tánaiste recently. That report, and a very substantive interim report which the group produced previously, set out more than 50 wide-ranging recommendations which the group saw as essential to the development of County Leitrim. This covers the point made by the Senator that this is a countywide initiative. The reports will be extremely useful in shaping policy in relation to the development of County Leitrim in the coming years. Many of the recommendations relate to major infrastructural issues which could only be implemented in the longer term.

Enterprise Ireland and IDA Ireland were represented on the project group. One of the group's recommendations related to advance factories. I understand that planning permission has now been approved for a new advance factory in Carrick-on-Shannon. The next stage is to commence discussion with the private sector regarding the funding and provision of the building. In addition, IDA Ireland has reviewed staff levels in the north west in response to a greater marketing focus on the region and an additional member of staff has now been appointed. A promotional brochure on County Leitrim has been produced by the development agencies to assist in the marketing of the county.

Since the project group's establishment, Enterprise Ireland has announced 64 jobs arising from a company expansion at Manorhamilton and the establishment of a new company in Roosky. In addition, Enterprise Ireland grant support was approved for two community enterprise centres at Carrick-on-Shannon and Manorhamilton. Enterprise Ireland is currently awaiting an application from the Ballinamore Community Group.

Following five years of record-breaking results at national level, IDA Ireland is refocusing its activity with a view to achieving better regional distribution of jobs from new greenfield projects. It is also reorganising its structure in order to respond to the changing needs of industrial development in Ireland in the years ahead. The new focus specifically aims to deliver more than half of all new jobs from future greenfield projects into the Objective One regions.

IDA wants to see the Objective One regions, which account for a quarter of the national labour force, double the proportion of jobs negotiated from greenfield IDA supported businesses. This means increasing the Objective One region's share of jobs from the present level of 25 per cent to 50 per cent of jobs in new greenfield projects. In this way IDA hopes to achieve better balance in job creation by overseas companies throughout the country.

For the future, IDA will undertake a more targeted approach to regional locations. Apart from the job dispersal issue, there is also a need to bring a better mix of industry sectors and higher value industries to some locations, particularly the locations that have not seen the emergence of modern industries.

IDA's internal structure is being reorganised to reflect the changing needs of the economy. Key executives are being charged with responsibility for delivering to specific regions, in addition to their traditional responsibility for projects and business development. This new structure recognises the critical need to deliver more to the regions and to integrate and co-ordinate the focus of the organisation on its regional development mandate.

The Senator can be reassured that the Government and the development agencies will make every effort to assist industrial development in County Leitrim.

Top
Share