I move:
That a sum not exceeding £23,555,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1971, for the salaries and expenses of the Office of the Minister for Industry and Commerce, including certain services administered by that Office, and for payment of sundry Grants-in-Aid.
In the Book of Estimates the net Estimate of £23,555,000 for the year 1970-71 compares with a sum of £19,633,600 granted in 1969-70 (including Supplementary Estimates of £3,121,000 and the transfer of £42,600 from the Vote for Remuneration) and shows an increase of £3,921,400.
The principal increase arising in the financial year 1970-71 is the increase of £3.5 million in the provision for capital expenditure for the Industrial Development Authority. The provision for An Foras Tionscal in 1969-70 in the main and supplementary Estimate was £15 million compared with £18.5 million now provided for the authority. Other increased provisions are: £228,067 for the authority for administrative and general expenditure; £137,000 for the Institute for Industrial Research and Standards; £96,000 for Córas Tráchtála and £80,000 for administration and general expenses of the Shannon Free Airport Development Company Ltd. There is an increase of £80,000 for shipbuilding subsidies after taking into account the reduction of £80,000 in 1969-70 for this service by way of the Supplementary Estimate passed in February last. Provision for additional staff in my Department accounts for an increase of £34,883. Increases in other subheads amount to £35,325 bringing the total increases to £4,191,275.
The principal decreases are £60,000 in the provision for technical assistance after taking into account £100,000 included in the Supplementary Estimate to which I have already referred. Provision is not required this year for a National Productivity Year; £64,000 was voted for this last year. The provision for the Buy Irish Campaign is down by £30,000; the provision of £40,000 for this service in 1969-70 included a non-recurring grant of £20,000 towards the erection of a display centre at the National Development Association's premises in St. Stephen's Green.
There was a decrease of £18,000 in the provision for the payment of interest subsidy to Shipping Finance Corporation Ltd. Other decreases amount to £22,450 bringing the decreases to £194,450 to which must be added an increase of £75,425 in Appropriations-in-Aid after taking into account the reduction of £47,000 in Appropriations-in-Aid in the Supplementary Estimate previously mentioned. The total decrease is therefore £269,875 and the net increase in the Estimate is £3,921,400.
The past couple of years have been a period of remarkable growth in Irish industry. The quarterly industrial inquiry figures show that the increase in production in industry has been accompanied by a very significant and very welcome rise in industrial employment, the figures for transportable goods industries in each of the four quarters of 1969 being between 10,000 and 12,000 higher than in the corresponding periods in 1968. In June of 1969 we broke through the 200,000 mark in employment in these industries for the first time and by the December quarter the figure had reached an all time high of 207,000.
Although the exceptionally high rate of growth in our exports achieved in 1968 was not fully maintained in 1969, the rate of increase, despite disruptions of production, was significant.
The rapid expansion of our industrial sector is an achievement for which all those concerned—management, workers and State and semi-State agencies engaged in assisting Irish industry, especially the export orientated firms—can justly take credit. But we must realise that it is taking place within a general economic situation which, in certain other respects, gives cause for concern. The pressure which excessively high imports are bringing to bear on our capacity to pay our way internationally, and the threat which excessive income increases carry for the competitiveness of our industry both on home and export markets, are symptoms of danger which we would ignore at our peril.
In the debate on the Estimate for 1968-69 it was necessary to emphasise that industrial adaptation is a continuing need. At present we are spurred on to take adaptation measures because of the approach of free trade with Britain and the probability of an even wider measure of free trade through membership of the EEC. Continuing developments in industrial technology, changes in marketing conditions and a host of other factors will continue to exert pressure on us to keep under constant review production and marketing techniques and other aspects of our industrial activity. Physical adaptation, by way of re-equipment and improvement of premises and other facilities, is and will continue to be an important factor in the overall task of enabling our industries to meet the challenge of tomorrow.
In the structural and organisational aspects of industry my Department in its contacts with industrialists, both at the firm level and the industry level, continues to stress the importance of rationalisation, whether achieved through mergers and amalgamations or through other forms of association. The Department not only encourages such measures in a general way but concerns itself with identifying situations where specific forms of association or co-operation offer prospects of greater productivity and wider markets. In such activities the Department operates in close collaboration with appropriate organisations offering technical and other specialised forms of assistance to industry.
Towards the end of 1968 the Government established a Committee on Industrial Progress, which is engaged in assessing progress made by industries in preparation for free trade with special reference to product policy and marketing problems. Having regard to the progress made in physical adaptation, the main aim of the committee's work is to identify the activities on which resources can most profitably be expended. The committee has arranged for surveys of a number of industrial sectors. Reports on some of these surveys have now been completed and the first report has been issued.
The most important form of adaptation that is needed in industrial life is the adaptation of mental attitudes. Without this, schemes of assistance by way of grants or otherwise cannot be fully effective. I have no doubt that there are many people engaged in industry who adequately appreciate the extent of the changes in the trading environment in which we now operate, the fact that the phasing out of protection is for many industries reaching a crucial stage and that within a few years at most the full pressure of external competition will be felt in all sectors of industry. It would, however, be unwise to assume that everybody engaged in industry, whether at management or other levels, fully realises this. I am afraid there are still too many people in industry who are not preparing to measure up to the demands which free trade will make on them personally; too many who have not yet rid themselves of the hangover from the period of protection. It is essential, both in their own interests and in the interests of the community as a whole, that such people wake up to the realities of our situation.
It would, however, be a mistake to see that situation solely in terms of the dangers it presents. We must think in terms not only of an increasingly competitive economy but also of an expanding one. If the opportunities which this offers are to be fully exploited, our managers, technicians and operatives must go all out to bring themselves to the highest pitch of efficiency. There is no lack of facilities to enable all who are engaged in industry to become more professional and more competent in their jobs. It is up to them to make the fullest use of these facilities. By so doing they will ensure that the most up-to-date knowledge and techniques will be harnessed in the service of Irish industry and that employment of a worthwhile character will be maintained and expanded.
As you know, the Industrial Development Act, 1969, became law in December last. Since the Act was very fully debated during its passage through the Dáil and Seanad I do not propose now to make a lengthy statement on the reorganisation of the IDA that is currently taking place in accordance with the provisions of the Act. As indicated, when the Bill was being debated, it is hoped that the IDA will now function with even greater efficiency than before and that industrial development in Ireland will go forward even faster. The Act, which became fully operative on 1st April, 1970, dissolved An Foras Tionscal and transferred to the Industrial Development Authority the powers, functions, rights, duties and liabilities of An Foras Tionscal. The expanded and reorganised IDA will vigorously pursue the task of accelerating industrial development with the aim of achieving more rapid progress towards full employment and better living standards for our people. The changes which have been made and are being made over the whole field of our industrial expansion programme are required in order to ensure that we are geared to meet the competitive and challenging era which lies ahead. The new Act makes provision for three new forms of cash incentives for industrial development; the authority may now give grant assistance towards fixed assets provided through leasing arrangements, they may subsidise interest payable on loans raised to provide fixed assets, and give grants for industrial research. The Act also gives legal effect to the scheme of grants for the re-equipment and expansion of existing industries which was introduced in March, 1968.
For projects located in the designated areas, formerly described as the undeveloped areas, An Foras Tionscal approved grants amounting to £11.2 million during the year ended 31st March, 1970 and £2.3 million was paid in grants. At 31st March, 1970, after making allowance for projects previously approved which did not proceed and for other grant adjustments, the total amount approved in grants for 352 projects in the designated areas was £27.8 million of which £12.4 million had been paid leaving outstanding commitments of £15.4 million. The total capital investment required for the approved projects is estimated at £66 million and the additional employment to be provided is estimated at 28,000 persons. Two hundred and eighty of the projects were in production at 31st March, 1970.
For projects located outside the designated areas, grants amounting to almost £13 million were approved during the year and almost £7 million was paid. At 31st March, 1970, after making allowances for projects previously approved which did not proceed and for other grant adjustments, the total amount approved in grants for 432 projects outside the designated areas was a little over £45 million of which nearly £20 million had been paid leaving outstanding commitments of about £25 million. The approved projects will require a total capital investment of £147.5 million and it is estimated that they will provide additional employment for about 38,000 persons. Two hundred and ninety of these projects were in production at 31st March, 1970.
The Small Industries Programme which was initiated in three selected areas in 1967 has now been extended to the country as a whole. I am happy to say that the extended scheme is proving very successful and many additional small firms have been assisted under it.
An Foras Tionscal, co-operating with the Small Industries Division of the Industrial Development Authority in the implementation of this programme, had, up to 31st March, 1970, approved a total amount of £2.9 million in grants for 403 projects recommended for assistance under the scheme and, at that date, had paid a total amount of just over £1 million in respect of such grants.
Grants amounting to a total of nearly £22 million were approved by An Foras Tionscal up to the termination of the scheme on 30th June, 1968, for 1,438 works of enlargement and adaptation requiring a total capital expenditure of over £97 million. The amount of grants paid during the year was £2.4 million, bringing total payments at March, 1970, to £14.9 million and leaving outstanding commitments of £6.9 million.
The Re-equipment Grants Scheme was introduced with effect from 1st March, 1968, and provided for grants of 35 per cent in the designated areas and 25 per cent in the remainder of the country towards the cost of fixed assets of programmes of re-equipment, expansion or modernisation. To date over 1,000 applications for re-equipment grants have been received. So far 571 cases have been approved, involving an investment in fixed assets of almost £24 million and grants of £5.9 million. Up to 31st March, 1970, no payment had been made in respect of grants under this scheme; payments are expected to commence shortly.
Since July, 1966, when legislation enabling An Foras Tionscal to develop industrial estates was passed by the Oireachtas, work on development of the estates in Waterford and Galway has progressed very satisfactorily. To date a total area of 742,000 square feet of factory space has been constructed. A further 160,750 square feet is under construction. The total capital expenditure to date is just £3.4 million.
There are now 24 firms operating on the estates. These comprise five American, four German, three British, two Swiss, one Anglo-Italian, and nine Irish firms. In addition four other projects have been approved for location on the estates.
Employment in the factories amounts to 933 persons at present, 70 per cent male, and the projected employment for the above 28 firms is in excess of 2,000 of whom 70 per cent are expected to be men. There is every reason to believe that each estate will provide direct employment for 2,000 persons at full development and a sizeable increase in the volume of employment in service industries can also be expected.
An Chomhairle Oiliúna, the Industrial Training Authority, have taken two standard factories covering between them 39,000 square feet on each estate for industrial training centres. A range of training courses specialising in the engineering skills is being provided and the existence of these training facilities adds greatly to the attraction of the estates for industrialists.
The demand for estate factories has been such that the original annual building programme of 90,000 square feet of factory space for each estate has been revised upwards to keep abreast of demand. In Waterford site works will commence in the near future on the recently acquired additional 62 acres.
The aggregate amount which may be expended by the Industrial Development Authority to meet its administration and general expenses and to discharge the obligations or liabilities incurred under the Industrial Development Act, 1969, or otherwise including those transferred to them under the provisions of the Act is £100 million. At 31st March, 1970, the total amount of grants approved was £97.7 million of which £48.3 million had been paid. Outstanding commitments in respect of grants approved by An Foras Tionscal amounted, therefore, at 31st March last to nearly £49.4 million. These commitments must now be undertaken by IDA. Total capital expenditure to 31st March, 1970, on the development of the industrial estates was £3.36 million. As Deputies are aware, the industrial functions of the Shannon Free Airport Development Company were extended to include the Clare/Limerick/North Tipperary region and departmental responsibility for the activities of the company, except those relating to tourism and aviation, was transferred to my Department. The effect of the extension of the company's functions to the region is to require additional grant-in-aid in respect of their running expenses and additional share capital for industrial estate development and factory building in the region. The Bill to provide for the necessary amendments to the Shannon Free Airport Development Company Limited Acts, 1959 to 1968, has already been before the Dáil and is now before the Seanad.
The technical assistance grants scheme is one of the State aids available to both manufacturing industry and the distributive trade. Its aim is to promote efficiency in industry and in distribution. The need to review and adapt, where necessary, continues with the progressive removal of tariff protection under the Anglo-Irish Free Trade Area Agreement and with the prospects of our membership of the European Economic Community. Assistance is given to manufacturers towards the engagement of efficiency experts. Similar assistance is given to the distributive trade services, provided it is sought on a collective basis through approved groups. In addition grants are available under certain conditions towards the cost of visits abroad by representatives of manufacturing firms and of the distributive trades.
The Government have shown their willingness to assist those who are ready to help themselves. In the last decade assistance to industry under this scheme has amounted to approximately £1½ million. The consensus of opinion among firms availing themselves of these grants is that the expenditure incurred by them has proved a very worthwhile investment. Those energetic and forward looking firms who have been preparing in this way for the challenge of the new competitive world will be in a strong position because they have shown that they are alert to the necessity for innovation in order to avail of opportunities in export markets.
The Irish National Productivity Committee, which was brought into existence in January, 1959, by agreement between its constituent bodies and with the full approval and support of the Government, have a special value in bringing together, at industry level, representatives of labour, management and education. The active involvement of labour is important in encouraging industrial productivity.
The value of the committee's achievement so far has been demonstrated by:
(1) the successful establishment outside Dublin of regional joint committees to promote improved communication and efficiency in industry;
(2) the establishment of the ICTU education and advisory service which INPC continue to finance; this provides an educational service for member unions and an advisory service staffed by trained work study practitioners;
(3) the promotion and development of professional institutes in the personnel and work study areas;
(4) the development of an advisory service which is playing a very important and increasingly effective role in meeting the objectives of the small industries programme;
(5) the successful organisation of the National Productivity Year.
The necessity for Irish industry to keep itself up-to-date in the matter of scientific and technical innovation has been emphasised. If we lag behind in this field we may find that our competitors, who are fully alive to the value of the scientific approach, will force us out of those foreign markets in which we have fought so hard to secure a foothold.
It is essential, therefore, that the Institute for Industrial Research and Standards, whose main function is to secure an improvement in the level of technology in Irish industry and to encourage the introduction into manufacturing processes of the very latest scientific methods, should be provided with the facilities to enable them to carry out their task.
There is a constantly increasing demand from manufacturers for the various services provided by the institute. Since 1966, for instance, the number of reports issued on laboratory analysis and testing has trebled, and the number of reports on factory and laboratory investigations has doubled. Requests for information and advice trebled during the same period and the number of research and development projects handled also increased substantially; in the year ended 31st March, 140 of these projects were dealt with, many of them arising from demands from manufacturers for the development of new and improved materials and components. This increased activity has given rise to a need for substantial increases in staff, the construction and extension of building accommodation and the provision of a wide variety of new equipment.
During the debate on the 1968-69 Estimates, reference was made to the five year plan of expansion submitted by the board of the institute. In considering these proposals we had had the benefit of the views of the National Science Council. The broad outlines of the growth of the institute, as envisaged in the plan and as clarified, and in part modified, in discussion with the council have been accepted.
It has not been found possible, either last year or in the current year, to provide a grant-in-aid sufficient to implement fully the early stages of the plan and it is likely that full implementation of its proposals will not now be realised within the time schedule laid down. Last year the grant-in-aid was increased by £125,000 compared with the previous year and in the current year an additional £137,000 has been provided bringing the grant-in-aid to £800,000, an increase of 50 per cent in the last two years.
In 1969, both total exports, and exports of industrial goods, reached record figures. Total domestic exports and re-exports amounted to £371.1 million compared with £332.5 million in 1968. When exports from Shannon are included our total exports in 1969 were worth almost £410 million.
Detailed figures for 1969 show that total domestic exports increased by 11 per cent over 1968. Industrial exports showed an increase of 18 per cent. This latter increase is of great significance because it reflects the further progress towards industrialisation and also because it is industrial goods which sell in more distant markets and which will help in attaining a more diversified export trade. We have, of course, always realised the need for diversification of our export markets, but the introduction of British measures to reduce imports at the end of 1968 emphasised the point and gave added impetus to our attack on new markets.
Exporting in 1969 was difficult, both because of British measures to curb imports and because of reduced industrial output following strikes at home which slowed the rate of increase in exports during the early months. However, the impact of the special measures for market diversification shows in the figures for the year. Exports other than to Britain and Northern Ireland showed an increase of over 25 per cent. These exports were spread over a wide range of countries; the biggest increases were in the EEC and North American markets. It must be our aim in 1970 to maintain and develop these exports, while availing ourselves fully of the expected easing of conditions in the British market.
Total domestic exports to Britain and Northern Ireland, although they continued to increase in 1969, show the effects of the general slowing down in consumer demand in Britain. There was a heavy increase in our imports from Britain, mainly in capital goods and in materials for further production, in the same period. Developments in both exports and imports are kept constantly under review.
Provisions exist within the Anglo-Irish Agreement for seeking remedial action in the case of any industry which is seriously threatened by increased imports resulting from the operation of the agreement. In the context of free trade, however, the effective answer to rising imports is an increase in exports.
In 1969 the Government decided that steps should be taken to initiate discussions at official level with East European countries, except East Germany, with a view to the conclusion of trade agreements with these countries.
Since then trade discussions have taken place with Bulgaria and there has been an exchange of views about the development of trade between Ireland and the USSR, Poland and Czechoslovakia. Further discussions in regard to trade with these countries, in cluding the question of trade agreements, are expected to take place.
During the past year Córas Tráchtála have continued to assist, financially and otherwise, an increasing number of exporters. The operation of the special diversification measures which I have already mentioned has brought about a noticeable increase in overseas promotions, including market surveys in the USA, Canada and the Middle East and increased promotional activities in the EEC and Eastern European countries as well as in North America and Australia. A full-scale trade mission has also visited Middle Eastern countries.
The export award scheme was introduced in 1968 and six further awards were presented in 1969. The scheme is intended to give State recognition to successful effort in exporting. The stress laid in the criteria of success on the use made of design, efforts in product development and adaptation, modern marketing methods and general enterprise further emphasises the importance of these factors from the point of view of export development.
The future development of our exports and of our economy as a whole is bound to be affected very profoundly by the outcome of our application to join the European Economic Community. International developments last summer and more recently the outcome of the Hague "Summit" meeting in December, 1969, have produced a clear indication of the political will of the member States to enlarge the Community and to open negotiations for that purpose with ourselves and the other applicant countries.
Indeed, work has been proceeding on the preparation of the Community negotiating position and the Council of the Communities hopes to complete this work in the month of June. On this assumption, the council is now proposing that a formal opening session of the negotiations should take place in Luxembourg on 30th June. It is envisaged that this will be followed by substantial negotiating sessions with the applicant countries not later than the autumn.
Since it is intended to provide time for a debate on EEC membership for this country in the near future, I do not propose dealing with the implications for Irish industry on this occasion.
The Government have extended, for a further period, the operation of the Prices Stabilisation Order, 1965, under which I am empowered to investigate and control prices. My policy in this regard will continue to ensure that there will be no unwarranted price increases.
In case there may be any misapprehension about the effectiveness of this policy, or in case it may be thought that price increases in full compensation for all increased costs are conceded more or less automatically, I should like to make it clear that each price application is subjected to a detailed and thorough examination in my Department. Each applicant is required to furnish very full supporting details, including documentary evidence in support of all cost increases claimed by him, the precise manner in which the proposed price increase will be applied to different products, goods, or services, the additional revenue expected to be derived from the price increase with full details of the way in which this sum has been computed, and copies of his certified financial accounts for a number of the latest years.
When all the information and evidence furnished by the applicant has been thoroughly investigated, and when the figure for the minimum of allowable cost increases has been determined, the capacity of the applicant to absorb cost increases is examined and, in a large number of cases, a price increase is conceded on a scale which will compensate him only in part for his minimum allowable cost increases. Thus applicants are required where possible to absorb a considerable proportion of their proven cost increases.
Deputies may be interested to know that in a recent 12 months period it was indicated in a total of 214 cases that no objection would be raised to certain price increases. The total of the cost increases claimed by all the applicants in these cases was roughly £22 million. The total for the minimum of allowable cost increases in these cases, as computed by my Department, was about £14 million, and the total of compensation given to the applicants, by way of price increases for the minimum of allowable cost increases, was £13 million. In this period of 12 months, therefore, the price increases conceded represented on average, only 59 per cent of the cost increases claimed by applicants, and only 93 per cent of the minimum of allowable cost increases as computed by my Department.
I must point out, however, that it it is unreal to expect that substantial cost increases, which occur under the headings of wages, imported raw materials, etc., can be absorbed by the industrial sector without compensatory price increases. Cost increases can only be absorbed either at the expense of profits, or by increased productivity. The certified financial accounts furnished by price applicants have revealed that, with few exceptions, profits in industry are reasonable; in some cases they are, in fact, at a dangerously low level, and in a considerable number of cases, profit trends, both in relation to turnover and to capital employed, have been on the decline in the period since price control was introduced.
This is a situation which needs to be very carefully watched in relation to further capital investment by industrialists on adaptation and expansion, or to the attraction of new industry and the provision of additional employment. Industry has been repeatedly exhorted to adapt to meet free trade, but it must be borne in mind that capital expenditure on adaptation must be financed mainly from profits.
The capacity of industry, therefore, to absorb cost increases from profits is now generally very limited and, accordingly, we must in future rely almost entirely on increased productivity to counteract any further cost increases, if the effects of such cost increases on prices are to be mitigated to any extent. I cannot, therefore, over-emphasise the urgent necessity for management in all industrial concerns to explore every possible prospect of increasing productivity, and to keep existing procedures under continuous review with a view to effecting progressive improvements towards this end. Equally I must urge workers to lend their whole-hearted co-operation to managements' efforts in this regard, so as to enable the maximum amount of unavoidable cost increases to be absorbed and thus mitigate the effects of these cost increases on prices and on the cost of living.
The Dáil has passed the Merchandise Marks (No. 2) Bill, 1969, which will enable me to make Orders requiring the marking of quantity and, where necessary, the name and address of the packer or importer on specified pre-packed goods as well as requiring the sale of such goods in standard quantities. I also hope to be in a position soon to introduce a comprehensive consumer protection Bill which would deal with other aspects of informative labelling, false or misleading trade descriptions and price indications and, probably, misleading or deceptive advertising.
So far the activities of the Fair Trade Commission have been confined to the supply and distribution of goods, but I now consider it desirable that the legislation should provide for investigation of restrictive practices in a wider field. Accordingly, I am having legislation prepared to amend the Restrictive Trade Practices Acts with a view to extending the scope of the commission. Hitherto it has been confined to dealing with restrictive practices relating to the supply of goods, or to services which were ancillary to the supply of goods. My intention is to remove this restriction and extend the scope of the commission to services generally, including professional services so that practically the whole of commercial life, with a few specific exceptions, will come within its purview.
The legislation will also introduce institutional changes, chiefly the creation of a special post the holder of which will be provided with statutory powers to carry out the investigatory functions hitherto discharged by the commission itself. This change should provide for greater speed in the operation of the legislation as well as ensuring that the commission can undertake an inquiry with the appearance as well as with the reality of complete judicial detachment.
The inevitable emphasis on manufacturing industry tends at times to obscure the important position which the distributive trades hold in the economic life of the community. The distributive trades are the channels through which the greater part of Irish manufactured goods reach the consumer. It is only by matching efficiency in industry with efficiency in distribution that we can ensure that the most favourable conditions prevail for the selling of our products in competition with imports. It is for these reasons that I intend to encourage a continued and sustained effort to achieve greater efficiency in distribution.
I have referred earlier to the assistance given to this distributive sector in the way of technical assistance grants and through the INPC. In this regard I would like to emphasise that the ability to achieve greater efficiency and competitiveness is not the prerogative of the large scale enterprises only. It is my intention to ensure that the framework of distribution in this country will always hold a place for the small and medium sized businesses which are prepared to make the fullest use of aids and incentives open to them.
Meetings between various groups of Irish manufacturers and the distributors of their products have continued under the aegis of my Department during the year. Distributors have recognised that, even apart from any question of patriotic duty, it is in their own interests to promote the sale of Irish goods, for without a properous industrial sector they themselves cannot prosper. I would hope to see a growing realisation of this amongst consumers too. It must be evident that, with the trend towards freer trade conditions, there is a tendency to import goods even where comparable local manufactures are available, which in the long run must be detrimental to the whole of the Irish economy. I would again appeal to consumers to buy Irish goods where available but always subject to the consideration that the home product must be competitive in terms of quality and price.
The changeover to the metric system of weights and measures is a process which will ultimately permeate every aspect of our economic affairs. Initially, the emphasis will be on metrication in industry and, indeed, the pace of change in that sector will determine the rate of change for the economy as a whole. It is recognised that the period of transition will vary from one industry to another depending in some cases on intrinsic factors affecting the different types of industry. It was for these reasons that no rigid timetable was imposed. Nevertheless, the Government feel that conditions will favour a change to metric system by 1975 for the greater part of industry.
My Department has been in contact with many organisations representing industry and has been encouraged by the response. Some industries favour an early change to the metric system. The consensus of opinion is that there are not likely to be any insurmountable difficulties.
The Government will do everything possible to facilitate the change to the metric system and various measures have already been initiated. Industry in general does not need, and indeed in some cases, has made it clear that it does not want, guidance as to the exact timetable of conversion to metric which it should follow. The time will come, however, when the distributive sector and the public at large will have to be prepared for the changeover. I feel that a broadly representative Metrication Board to prepare a programme in this respect could be useful, and I am keeping the possibility of such a board before me as matters develop.
Minerals exploration is proceeding satisfactorily. There were some 669 prospecting licences current at 31st December, 1969, compared with 480 at 31st March, 1968.
Detailed reports for 1969 from the three base metal mines have not yet come to hand but Press releases by the operating companies indicate satisfactory results for the year. Despite a labour dispute resulting in a three-months stoppage at the lead/zinc/silver mine at Tynagh, County Galway, indications are that, due to significant lead and zinc price increases, the company's outcome for 1969 is expected to approximate to that of the previous profitable year. At the copper/silver mine at Gortdrum, County Tipperary, exports of concentrates in 1969 were almost 16,000 tons. The discovery of mercury in 1968 led to certain temporary difficulties, but these have been largely overcome and exports of mercury commenced recently. The lead/zinc/silver mine at Silvermines, County Tipperary, opened officially in September, 1968, has completed its first year of trading. Projected annual output of the mine, when in full production, is 225,000 tons of concentrates. The increase in value of exports of metal ores and concentrates from £9 million in 1968 to £17.3 million in 1969 reflects the substantial impact of these three mines on the economy. The value of exports of barytes rose from £683,000 in 1968 to £930,000 in 1969. The sale of the assets of Saint Patrick's Copper Mines, Limited, to an international consortium has been completed. The Avoca Mines are being prepared for reopening and are likely to be in production by the end of 1970.
Results of exploration for petroleum and natural gas within the land area of the State carried out by Marathon Petroleum Ireland, Limited, under the 1959 Oil Exploration Agreement have not been encouraging and interest has now turned to offshore or continental shelf areas. The Continental Shelf Act, 1968, provides a statutory framework for the exploration and exploitation of the natural resources of this country's continental shelf in accordance with the principles laid down in the 1958 Geneva Convention on the Continental Shelf. An order was made under the Act in 1968 designating certain areas over which the rights of the State will be exercised.
Following protracted negotiations with Marathon Petroleum Ireland, Limited, agreement was reached whereby the company had been granted exclusive rights over three offshore areas included in the designation order and representing less than half of our shelf area. The 1959 oil agreement with the company had been amended in the light of this settlement. The company have completed a seismic survey of certain offshore areas followed by more detailed investigation and have been granted a petroleum lease in respect of an area of 400 square miles about 30 miles off the coast of Cork. The company have commenced drilling in the area. A number of companies have indicated interest in offshore exploration. Further areas have been designated and it is proposed to grant non-exclusive licences to competent applicants conferring on them the right to undertake general surveys over our entire designated continental shelf area exclusive of the area granted to Marathon. The potential of our shelf area is still largely unknown but it is hoped that the exploration of the area will result in the discovery of valuable resources, the exploitation of which could be of great benefit to the economy.
The phased reorganisation of the geological survey, initiated in 1968 with a view to equipping it to provide the specialist services necessary for the expanding mining industry, is proceeding satisfactorily.
Subsidies have been paid on ships built in Verolme Cork Dockyard from the commencement of shipbuilding operations. A total of nine ships have been built and subsidy payments are made from time to time on the recommendations of a special committee. At present, four ships are under construction at the yard.
Total subsidy payments from their inception to 31st March, 1970, amounted to £1.36 million.
Following a report by a firm of consultants on the future prospects of the yard, the Government agreed in November, 1967, that the dockyard may, as well as continuing in shipbuilding activities, engage in ship repair work and in certain fields of general engineering work not subject to protective duties.
Provision of subsidies at the existing level will continue for about a further two years when the position will be reviewed. When the subsidies for shipbuilding were introduced in 1963 the Government also agreed, subject to certain conditions, to a waiver of interest on loans which Verolme Cork Dockyard had obtained from the Industrial Credit Company. Under the 1967 reorganisation proposals, it was agreed that this waiver of interest should continue until such time as the company has reached the profit stage. This is, of course, a form of additional subsidy. Interest waived amounted to some £87,000 annually, and the accumulated amount waived at 31st March, 1970, was £724,000.
Towards the end of 1968, the board of Verolme Cork Dockyard, Limited, was reconstituted giving the State two representatives, one of whom is chairman.
Shipping Finance Corporation, a subsidiary of the Industrial Credit Company, has for a number of years been making loans at low interest rates to shipping companies to finance the purchase of new vessels from Irish shipyards. It is necessary to recoup the Industrial Credit Company to the extent of the difference between the rate charged on these loans and their borrowing rate plus something for out-of-pocket expenses and to build up a reserve. A provision of £61,000 for interest subsidy is, therefore, made in this year's Estimate.
In conclusion, I shall be glad to answer any questions which Deputies may wish to put on details of the Estimate, which I now commend to the House.
