Vol. 249 No. 11
andMr. P. Belton asked the Minister for Transport and Power if, in view of the serious consequences arising out of the appointment of a liquidator in respect of the Hibernian Transport Group and the disemployment of approximately 500 persons, he will hold an immediate inquiry into the whole position of this group; if he will take immediate action to avert the threat to the employment of the 500 persons involved; and if he will make a statement on the matter.
10.
asked the Minister for Transport and Power whether he is aware of an immediate threat to the jobs of 500 employees of the various companies included in the Hibernian Transport Companies, following the announced liquidation of the companies as a result of losses due to failures of management; whether he is aware that several employees have already received intimation of notice of dismissal; whether he will arrange immediate negotiations to include the group companies with State transport companies already in operation so as to protect the jobs of the employees affected.
11.
asked the Minister for Transport and Power whether he proposes to take any action regarding the liquidation of Hibernian Transport in view of the serious implications for transport and the tourist industry.
12.
asked the Minister for Transport and Power whether, in view of the immediate effect on the balance of payments caused by the imminent liquidation of Hibernian Transport, owing to the fact that shipping services provided by the group will be lost immediately and permanently to Dutch interests, who are the only competitors on the affected routes, he will act forthwith to protect the national interest.
13.
asked the Minister for Transport and Power how much money has been invested in Palgrave Murphy, Limited by Irish Shipping, Limited; and what return has accrued from same.
With your permission, a Cheann Comhairle, I propose to take Questions Nos. 9, 10, 11, 12 and 13 together.
I have been kept fully informed by the board of directors of Hibernian Transport Companies Limited of recent developments in relation to the group. Having reviewed their position and considered the options open to them, the board have decided to go into voluntary liquidation. The shareholders of two of the companies making up the group will be asked to adopt a resolution to this effect at an extraordinary general meeting on Friday, 27th November. It is the intention of the board that the shareholders of the other companies in the group will, in due course, be asked to adopt similar resolutions. I have no doubt that the board, in arriving at their decision, gave full weight to all the relevant considerations and it is a matter for regret that circumstances did not, in their view, enable them to continue in business.
Where the board of directors of a private concern such as this, having reviewed their position and considered all the options open to them, decide to cease trading and seek the approval of their shareholders for this course, I have no power to compel them to alter their decision.
There is no provision for the holding of an inquiry in circumstances such as these into the affairs of a private company.
I understand that the Minister for Labour is obtaining all available information from the group about the position of their employees in regard to the serving of notice, eligibility for redundancy payments and the possibilities of alternative employment.
Two of the regular cargo services from Ireland to Continental Europe are owned by Netherlands firms. Under the conditions of freedom of shipping which apply in Ireland it is open to any shipowner or charterer, Irish or foreign, to operate a service between Irish and foreign ports wherever they consider that it would be economically advantageous to do so. In these circumstances, it does not follow that the business previously handled by the Hibernian Group will be taken over by these operators.
Irish Shipping Limited invested £150,000 in shares and debentures in Palgrave Murphy Limited in 1964 and received the normal dividends and interest on them. In May, 1969 they sold their holding and instead made a loan of £130,000 to Hibernian Transport Companies Limited. Interest has been paid on this loan to date.
In view of the gravity of the situation, the fact that some public money was involved in this, that it is not an isolated single transaction, and the fact that so many companies makes the situation a complex one, will the Minister not consider initiating with the directors of the company concerned discussions which would ensure that employment will continue at least in order to give adequate time for alternative arrangements to be made?
I have discussed the situation very fully with the directors of the company. The situation is that once the process has got under way we must await the decision of the shareholders tomorrow week as to whether or not a liquidation decision is to be taken by them. It will then be a matter for negotiation between the liquidator and any other interest, private or public, who may wish to engage in negotiations for one or more than one of the companies involved. I appreciate the social problem involved to which Deputy Cosgrave has referred but this process must take place first.
I appreciate that that is the position under the Companies Act once the liquidator is appointed. This is a highly complex situation, which apparently has arisen because of very serious mismanagement. Is it right to rely on legal technicalities while the interests of the employees are seriously jeopardised with serious consequences for their families? Has the Minister contemplated any alternative action to enable time to be gained in order to preserve their position?
The only alternative action put to my Department by the board is one that would not commend itself to me, the Government or the House in that it would involve substantial investment in a concern that in our view at this stage, having regard to its financial situation, would not warrant such investment. Irish Shipping had shares in the firm and they are now in a loan position; they are in a preferential credit position. That is the only public money involved.
Did they sell because they saw the writing on the wall?
Quite apart from the unemployment that may be caused to members of this firm, is the Minister aware that there are many outstanding debts between this firm and small firms which will spread the area of unemployment? As the avoiding of unemployment is the most important objective here, has the Minister considered a link up between a State investment, namely, B & I, and the section of this company's business involved in the same business? Does it not seem commonsense that this possibility should be investigated? Has the Minister already discussed with the directors of this company a link up between B & I and a section of this company in order to save the jobs of the people in question?
As I have indicated to the House B & I are considering this. CIE are also considering this very actively in regard to the Shannon Travel Company subsidiary.
What about Global?
CIE have today made a decision, which will be indicated in the newspapers tomorrow about their interest in Shannon Travel Limited because of the similar type of work which CIE are doing in regard to their tour and carrier promotional operations in the United States of America particularly, and in Europe to some degree. There is an equivalence of interests between the type of work that was done heretofore by Shannon Travel Limited and that particular division of CIE. An announcement will be made tomorrow in the papers about that aspect of it. All these matters are being considered. The important point to remember as far as the Government are concerned is that the full ramifications of the exact financial position of this company have not yet emerged. It would be very unwise for the Government to start moving in to subsidise a private concern of this kind before the full financial position is known.
Is it not a fact that Shannon Travel was solvent but the money was taken out of it?
This will emerge in the liquidation investigation. As Deputy Cosgrave has said, this is a very complex position. There are a number of companies involved and the full picture has not yet emerged.
Will the Minister say whether or not he knows if there was any consultation with workers and the trade unions before the announcement was made?
That is a matter for the company. I am meeting the trade unions next week.
The Minister has agreed to meet the trade unions?
I have.
It is to be deplored that any firm should close down without any prior consultation with those involved in the industry.
Is the Minister aware that Global, an English company, are now in negotiation with Shannon Travel? Is the Minister further aware that Aer Lingus are due £200,000 from this company?
Of course I am aware of it.
The Gresham Hotel and various other hotels are also owed money. According to Hibernian Transport's own statement they have 50 per cent of the business out of Rotterdam, Antwerp, Le Harve and the ports of Cork, Waterford and Dublin. Fifty per cent of this business is run by Hibernian Transport and the other 50 per cent by Dutch companies. As Hibernian Transport have already taken their ships off this route the Minister should put on other Irish ships. As far as I am aware this is a profitable line, and the Minister should ask the Irish Shipping group to take over this business straight away.
We cannot have a debate on this.
It is a very important question.
I know it is a very important question, but we cannot have a debate on it at Question Time.
There are 800 people involved because there are 200 casual dockers plus 100 people who work in the summer on the travel section as well as the 500. A person wanting goods transported has two choices: he can go to the Irish company or the Dutch company but if the Irish company are not operating he will naturally go to the Dutch company. The Minister should charter ships to ensure that we do not lose this business.
All options are being kept open as far as I, and the Government, are concerned. Of the State companies B & I and Irish Shipping are the most prominent, but CIE is very much involved with one of the subsidiary companies. I feel this can best be resolved by being left to business processes. I can assure the House I am keeping a close eye on the matter. This is a matter about which I have no direct concern. If I wanted to adhere strictly to the rules of the House I need not have taken these questions at all, but I do feel very strongly that this is a matter of public concern. It is very welcome that these questions were put down and have resulted in this discussion but we are moving into an area now where business decisions will have to be taken.
I wish to raise this matter on the Adjournment.
We are all very glad to learn that CIE are interested in Shannon Travel. First of all, has the Minister taken any steps to ensure the future employment of the road freight section of Hibernian Transport which is a very big concern? I want to assure the Minister that the employees of Hibernian Transport were not told until 12.30 on Sunday night that the company were going into voluntary liquidation.
Scandalous.
Secondly, has the Minister considered the implications of handing over Hibernian shipping to a Dutch company and how it will affect our external assets? What flag will be flown from the ships sailing with Irish goods? What steps has the Minister taken further to increase the offer made by the Bank of Ireland of an immediate advance of £375,000 to keep this company floating at least for some time until a public inquiry is held?
This is a long question.
It is a very difficult problem and it deserves the minutest and most detailed investigation and we are going to have it here and now.
We cannot discuss it. I will allow Deputy Cosgrave to put a final question.
What I said to Deputy Cosgrave earlier is absolutely accurate. This matter is so complex that the extent of the financial problem involved is not known even to the company concerned or to me.
In view of the complexity of the problem and the fact that the positions of so many employees are involved has the Minister considered co-ordinating the efforts of all interested State companies so that a joint, even temporary, rescue operation can be undertaken by them?
As I have said CIE are making an announcement today which will be in the papers tomorrow, about the Shannon Travel Company.
I am calling Question No. 14. I have allowed many supplementaries.
Will the Minister say whether he received a letter from the Transport Union this morning? The Minister has indicated he will meet the union next week.
That letter has gone to Mr. John Carroll.
Could the Minister not meet the union tomorrow?
I am meeting them next week.
It is too urgent a matter to leave over to next week.
The business side is complicated, but has the Minister consulted with the State companies under his control about the feasibility of a link-up operation with this company?
I have said this.
Would the Minister consider any form of underwriting a loan to keep the company in business until the feasibility of a link-up arrangement is established?
I met the chairman and general manager of CIE yesterday and they are having a board meeting today in which they are dealing with one of the subsidiaries. Discussions are taking place with the other two State companies concerned. But I want to say this: the full implications of the real financial situation involved are not yet evident and that, undoubtedly, is not a factor which helps immediate or instant decisions, as the House will appreciate.
Could the Minister say what day next week he will meet the unions?
That is being arranged at the moment in my office.
Has anything been done about the road freight section of——
Order. I shall allow Deputy T. O'Donnell to put a supplementary question.
Is it a fact that Hibernian Transport made approaches to the Government a month ago? Would the Minister say whether Hibernian Transport informed him a month ago of their proposal to liquidate and would he say whether the company then put any proposals to the Government?
They made approaches to the Government practically a month ago, three or four weeks ago, through me and these approaches then indicated a far less serious financial situation than is now emerging. The facts of the matter are that if we met the company at that stage in the manner in which they sought to be met financially, the taxpayers' money would be where many other people's money, I fear, is at present.
I am calling Question No. 14.
I wish to raise this question on the Adjournment.
The Chair will communicate with the Deputy.
Is it the position that the Minister one month ago——
Let the Deputy not put words in my mouth. I have known for the past three weeks of the financial difficulty into which this company might be getting. The present situation in regard to these financial difficulties is far more complex and likely to prove far more serious than originally envisaged. That is all I am saying. If we took a wrong decision as a Government or if I did so as Minister for Transport and Power and so recommended to the Government and if we had carried out some rescue operation three weeks ago, our money could be where many other people's money is.
Could the Minister say what he has done in the past three weeks?
I have met the board regularly in my Department.
Everybody knew except the workers that it was going to close down.
Did the Minister in the three weeks that have since elapsed consider that the unions should be brought into it?
I am calling Question No. 14.
I demand an answer to my question: what is happening in the road freight section of the Hibernian Company?
It is in the same position as all the other sections.
The Minister told us CIE were interested in Shannon Travel. What about the road freight section?
This is the same position as if Deputy Belton came along to the Government asking the Government to rescue the Belton group of companies——
We will not come near the Minister anyway. We do not need to. It is not the same situation at all. There is Government money in it.
There is no Government money in it.
Question No. 14, Deputy O'Donnell.
