asked the Minister for Industry and Commerce what royalties a mining company can be charged; how these royalties are calculated; what royalties a company (name supplied) in County Meath will pay; and if he will make a comprehensive statement on the matter of royalties.
Ceisteanna—Questions. Oral Answers. - Payment of Royalties.
21.
The Minerals Development Acts empower me, if I consider it is in the public interest to do so, to grant leases of State minerals to such persons and for such term as I think proper. The Acts provide that, unless it is considered that it should, in the public interest, be made free of payment, any such lease shall be made subject to such financial terms, including payment of royalties, as I, with the concurrence of the Minister for Finance, shall think proper and shall agree with the lessee.
In general, the financial terms of State mining leases take the form of dead rents merging in royalties. In practice, royalty rates applicable to State mining leases are such as have been agreed with lessees, usually after protracted negotiations and hard bargaining. They are not standardised. They may take the form of a tonnage levy, an ad valorem sales percentage or a graded percentage of profits. The extent of the rates is governed by many considerations including the nature, accessibility and value of the deposits to be worked as well as social and risk factors.
As no lease of State minerals has been granted to the company named by the Deputy, the Deputy will appreciate that I am not in a position to state at this stage, what royalties that company will pay in the event of a lease being granted in the future to the company.
Particulars, including royalty rates, of all leases of State minerals and of receipts under the Minerals Development Acts, 1940 and 1960, from royalties and fees are contained in the reports laid before the Oireachtas in accordance with the requirements of the Acts.
May I ask the Minister whether he is satisfied and whether he would agree that the current system between the mining consortia and the Department of Industry and Commerce in consulation with the Minister for Finance whereby it appears that the royalties received by the State—rather marginal so far, some half million pounds for several million pounds extraction—seem to be based on very notional profits arising from the extraction and export of ore? The current system by and large seems to be most unsatisfactory. It seems to be very minimal in terms of returns to the State. Therefore, would the Minister undertake an immediate and urgent review of these rather serious developments, in the light of royalties received to date, and more particularly the extent to which the State seems to have no way of checking and no way of reaching a joint surveillance on what precisely is going on in relation to the working of many of these companies.
I do not accept that the State has no way of checking and no satisfactory form of surveillance. As I said last night on the Adjournment about a mining lease in relation to the subject matter of this question, I am satisfied that the question of the royalties needs to be looked at very carefully by me in relation to the bargaining that will have to be done surrounding the issuing of a lease. I do not accept that the return to the State so far has been unsatisfactory. On the other hand, I am anxious to ensure that the return to the State from future mining will be more satisfactory.
In view of the abysmal ignorance which has been displayed by many people in high and low places about mining and the actual costing of mining, and particularly in relation to State royalties and the cost of exploration, would the Minister consider that it would be a useful exercise on the part of his Department to issue some type of document to counteract the misinformation which is being spread throughout the country and which is doing harm to everybody, including the State?
I agree that a lot of misinformation is being spread throughout the country and the State is being attacked together with the companies at present operating. I think they have certain responsibilities as well.
Question No. 22.
This is a rather important question.
I know, but there are other questions and the Deputy has asked a supplementary.
With all respect I would point out that the Minister is dealing with Questions Nos. 21 to 26.
The Deputy may not determine how many supplementary questions are allowed.
I am dealing with Question No. 21.
The Minister is dealing with one question.
Could I put it to the Minister that the Mining Act——
The Deputy may not put it to anybody. He may ask a question.
Arising from the well-known fact that the Mining Acts include a specific clause which indicates that certain action shall be taken by the Minister in the public interest, would the Minister agree that it is desirable that, where further exploration, extraction and export of ore is likely to develop to a considerable extent, some element of State holding, 5 per cent, or 10 per cent, or 20 per cent, should be taken out as an integral part of any such agreements with such companies in such mining corporations to ensure that there is some elementary Government supervision of what is going on in these companies? I defy the Minister, and strongly challenge the assumption of the Minister that the Department of Industry and Commerce——
We cannot have a debate on this. The Deputy may not go on debating the matter. It does not arise on this question which relates to royalties and nothing else. Question No. 22.
Could we have the Minister's reply?
I feel that the Deputy is suffering from certain hallucinations in this regard. The Department knows a heck of a lot more about it than he gives them credit for. Unfortunately, the Deputy seems to be taking all his evidence from the misinformation which Deputy Tully has just said is being supplied.
On a point of order, when I see mining licences being backdated——
The question of mining licences does not arise for discussion. The question relates to royalties.
An allegation has been made by the Deputy that mining licences are backdated. He has made that positive allegation and I should like to have it on record because it is completely out of order.
It is not out of order.
Ask Deputy Tully does he agree?
It is not true. Some people do not understand the way the thing works. There is no question at all of that.