Dáil Éireann díospóireacht -
Wednesday, 13 Dec 1972

Vol. 264 No. 7

Committee On Finance. - Vote 40: Industry and Commerce.

Minister for Industry and Commerce (Mr. Lalor)

I move:

That a sum not exceeding £35,810,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1973, 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.

A supplementary Estimate has been circulated for a token sum of £10 to enable money to be provided for the purpose of restructuring the wool textile industry.

In the Book of Estimates the net Estimate of £35,810,000 for the year 1972-73 compares with a sum of £33,842,000 granted in 1971-72— including a Supplementary Estimate of £5,019,000.

In round figures the principal increases arising in the current year include £511,000 for the Industrial Development Authority to cover Administration, £61,000, and capital expenditure, £450,000; £345,000 for the Institute for Industrial Research and Standards; and £275,000 for the Shannon Free Airport Development Company Limited, of which £200,000 is for grants to industrialists. There is an increase of £246,000 in the provision for Córas Tráchtála. The provision for salaries and wages of the staff of my Department, including technical advisers shows an increase of £82,000. Other increases are £50,000 for shipbuilding subsidy; £93,000 for the payment of interest subsidy to Shipping Finance Corporation Ltd; £37,000 in the provision for repayment to the Central Fund of advances under the export guarantee arrangements; and £41,000 in the provision for the purchase of equipment, et cetera for the Geological Survey Office. Other subheads show a net increase of £26,000. There is thus an increase of £1,706,000 in the expenditure subheads to which must be added the falling off in Appropriations-in-Aid which are expected to be some £262,000 lower than in 1971-72.

The net increase in the Estimate is, therefore, £1,968,000. It has been the practice, when introducing the annual estimates, for the Minister for Industry and Commerce to cover in considerable detail most of the various functions and areas of responsibility with which his Department is concerned. I feel it would be more appropriate in present circumstances if I were to concentrate my remarks on a relatively few key matters which are of major concern. The matters I propose to deal with are industry and industrial development, mineral development, prices and the broad field of consumer protection.

It is customary also to report on the results of the previous year. I believe that it will be more useful if I speak only briefly of what happened in 1971 and try to deal rather with the present situation and the outlook for the future.

First, I must mention the one dominant factor which affects the work of every section of my Department, as of other Departments, I mean, of course, our entry to the European Economic Community on 1st January, 1973. Our membership of the EEC is the end of one stage of development and the start of another. It ends a phase in which great progress was made but one which we must now go beyond if our standards of living are to be raised to the level of western Europe generally. From now on our industrialists must be outward-looking as never before. The traditional home market horizons will be expanded to the frontiers of the new Community and beyond.

We enter on this new era with the great psychological advantage that we know we are taking a step which the vast majority of Irish men and women have endorsed. The people did not take this historic decision lightly, but rather after careful consideration of the pros and cons of EEC membership. The result was an overwhelming response from the people in favour of joining Europe next month.

What happens from January next; can we sit back and wait for the benefits to fall into our laps? Of course not. We must determine to work harder and more effectively than ever before to convert the many opportunities of membership into achievements. On the industrial front, this effort will be required equally of management and workers. One complements the other. Consumers, too, have their part to play by continuing to support Irish goods, and this applies equally to the individual consumer buying goods for his own use and to the industrial consumer purchasing goods for conversion. We will progressively reduce our tariffs on imports from other Community countries, but we must not let the novelty of new sources of supply blind us to the quality and value of our own produce and manufactures.

The advantage likely to accrue to Ireland in the industrial sector on accession to the Community have already been spelled out on many occasions and I do not propose to go into detail here today. Suffice it to say that membership should mean more jobs, the widening of our industrial base and greater export opportunities. Membership will bring a challenge in the form of foreign competition, but it can, I am confident, be successfully met by the fruitful co-operation of mangement and workers.

The Confederation of Irish Industry is as confident as the Government and the people of Ireland that EEC membership will be the best thing for us.

Mr. Donegan

Is the Minister sure?

Mr. Lalor

Yes, sir. On the crucial question of whether or not the terms negotiated for entry will provide us with a better economic environment for future development, the Confederation has said: "It is very clear that the balance of advantage for Irish industry lies inside the European Community".

The rate of economic growth improved in 1971, principally because of a faster rise in industrial production. The 3 per cent economic growth in 1971 reflects an actual rise in the volume of output of both manufacturing and transportable goods industries of 4 per cent. This rise in production is due to an extent to a recovery from the effects of industrial disputes of 1970. Not surprisingly, in view of the strike in the cement industry in 1970, the industrial group to which this industry belongs recorded the largest increase in output, 38 per cent, in 1971.

In 1971, industrial exports, with which I shall deal in more detail later, maintained their steady increase of the past years, rising by £32 million the equivalent of 10 per cent. This rate of expansion was achieved in spite of the depressed state of some of our main export markets and the sharp decline in exports of metal ores. Industrial exports constituted 52.6 per cent of our total domestic exports, which themselves grew at the rate of 15.2 per cent.

The past year has been a difficult one for Irish industry. A number of firms were forced to close, with resulting unemployment, while in other cases firms encountering difficulties were obliged to reduce their work force to prevent complete closure. The number of workers becoming redundant in the year ending 31st March, 1973, is estimated at 11,000, a very high figure. Fortunately the establishment of new industries and the creation of new jobs has continued.

Factory closures get their fair share of publicity from all the news media and this is only right, but I think Deputies should know that there have been many cases where firms encountering difficulties have been saved by the remedial action taken by my Department and the State agencies concerned, notably Fóir Teoranta. These intervened in many instances to assist firms which, though potentially viable, were in danger of closure through inability to raise finance from commercial sources. The outcome of these efforts is frequently unpublicised in contrast with the publicity attached to factory closures. Indeed, in many instances the maintenance of strict confidentiality was an important factor in the success of the rescue operation.

Remedial action of this kind depends on sufficiently early notice being received by my Department or the IDA that a firm are in difficulties and willingness on the part of the management concerned to make the necessary efforts to continue in business. The Government, however, cannot force firms to reveal in time that they are in difficulties; we can only encourage them and their advisers to be more ready to do so.

The causes of redundancy in industry are many and complex, and there are no ready-made solutions to the problems that may be encountered. Too frequently, free trade is named as the main problem. Undoubtedly, our tariffs against Britain have now been substantially reduced as a result of the Anglo-Irish Free Trade Area Agreement, but it would be much too facile to blame free trade for our problems. Ireland more than most countries depends on foreign trade, both imports and exports, for a high standard of living. Many sectors of Irish industry and many firms already depend on export markets for their prosperity, and it is clear that Irish industry as a whole must look to export markets for substantial growth. We cannot expect to have access to growing export markets without giving in return access to our market to other countries. Free trade must be seen therefore as a tool for growth something to be used, not something to be feared.

Our recent difficulties in industry have been caused by slackness in our main export markets, fluctuations and uncertainties in international exchange rates, and above all by cost inflation. To an extent this cost inflation has been imported owing to rising prices elsewhere and also to the floating of the pound, but a major element has been the high rate of growth in wages and salaries in Ireland, unmatched by corresponding rises in productivity. When wages and salaries here rise faster than they do in other countries, our firms lose their competitive edge and become at one stroke more vulnerable to imports and unable to develop their sales to other markets.

The pressure of cost inflation has thus been a major factor in causing redundancies. It has pinpointed and aggravated the weaknesses in different firms, some of which were compelled to close, others to cut down costs wherever possible by rationalisation, by discontinuing uneconomic lines of production and so on.

When the reasons why a particular firm have got into difficulties are examined, it is often found that difficulties stemming from the general economic situation have been aggravated by local management deficiencies. Inadequate financial and cost controls, and failure to move with the times in regard to marketing and product policy are frequently noted. This has been highlighted in the COIP reports and elsewhere. It is very disturbing, indeed, that firms can find themselves in severe difficulty without apparently having been aware of the situation which was developing, let alone alert others to their problem. This lack of proper management accounting is a serious problem especially in smaller firms. In the absence of proper accounting and cost procedures, a firm may not know from one end of the year to another what their situation is. I suggest that this is a problem to which the accounting profession and also the banking institutions might give increasing attention with a view to helping their clients.

I have mentioned the importance of timely adaptation or diversification. The Government have made very considerable efforts by way of grants, the extension of the services of State agencies and the creation of new ones, and by general exhortation, to get industry to adapt to changing conditions. By and large these efforts have been fairly successful but it has to be recognised that they could not of themselves guarantee the survival of every manufacturing firm. In the last analysis this depends on the efforts which the firm make.

The response from the different sectors of Irish industry to the challenge posed by the changing trading situation has varied. Some have been less active than others in their preparations, and within sectors the reaction of firms has also varied. Experience has shown that it is difficult, whether through adaptation associations or otherwise, to get sectors to take an initiative on an organised basis—or indeed to accept initiatives taken from outside. The experience in getting action on recommendations of the COIP reports is no more encouraging than in the case of the reports by the Committee on Industrial Organisation which operated in the early sixties, despite the fact that there is less time left for action now. I repeat that Government Departments and agencies can only help and encourage and cannot compel.

One of the principal means for helping industry to maximise its level of efficiency is the technical assistance scheme. Under this scheme, grants are made available to manufacturing industry towards the cost of engaging the service of business consultants who provide expert advice on matters affecting the improvement of productive efficiency and also on aspects of distribution and sale of goods on the home market. Grants are available also to the distributive trades on a group basis. While use of the scheme was fairly limited in the early years, the pressure of competition on the home market has caused more and more firms to turn to the scheme in an effort to streamline production and sales and to reduce overheads.

Since 1957 my Department have paid out more than £2 million in respect of these activities. I am satisfied that the expenditure incurred both by firms and the Government has proved useful in achieving a state of preparedness in industry and distribution to meet the challenge in the years ahead.

The adoption of the highest standards of technical efficiency in industry must be a continuing priority, never more important than at present. The need for advancing our industrial technology and efficiency to the highest possible level has been kept before the eyes of industry by myself and others over the past number of years, but, while great progress has been made, I am afraid it is true that there are still firms, and indeed sectors of industry, where the level of technological advance is not yet satisfactory. I rely principally on the Institute for Industrial Research and Standards to preach the gospel of technology to industry, to help industrialists to maintain the level of efficiency of their plants in line with the advance of technology in world industry, and to introduce the new products, or the new methods of producing traditional products, which research and development continually offer in different fields.

The institute have prepared a five-year plan for their development during the years 1971-76. This plan has been examined in detail and generally endorsed by the National Science Council, and returned to me for my consideration. I have in general accepted the proposals in the plan which envisage that an increasing proportion of their resources will be devoted to research and development. I am glad that I have been able this year to increase the institute's grant from £948,000 to £1,293,000, this latter sum including a provision to enable a start to be made on a comprehensive building programme.

Increased productivity by workers can also help Irish industry to improve its competitiveness. This is the special concern of the Irish Productivity Centre —formerly known as the Irish National Productivity Committee. This body are representative of employer and labour interests. They are financed mainly by way of grant-in-aid under the Vote for the Department of Industry and Commerce, and concern themselves with the identification of factors which impede the growth of productivity, pinpointing areas where there are significant productivity gaps and taking steps generally to bring about improvement in those areas. In 1971 the committee completed an appraisal of their structure and function following a survey carried out by the European Association of National Productivity Centres. When I introduced the token Supplementary Estimate for £10 on 11th July, 1972, necessitated by the change of title of this body, I outlined the circumstances leading to the change in the structure of the organisation.

The pressures of cost inflation are still with us, and rationalisation of industry is still very far from complete. Although there are signs of a slowing down in the rate of redundancy, it would be foolishly optimistic to expect that the difficulties of Irish industry will not continue somewhat longer. Recent studies of particular industries have shown that there will be further redundancies.

I will continue, by the forms of assistance which I have mentioned and by any other means which circumstances may show to be desirable, to afford every assistance to industry, particularly those sectors which are at present going through a difficult period.

Last year I expressed particular concern about the situation of the wool textile industry, which at the time was suffering very much from short-time working because of the world-wide recession in wool textiles over the preceding year. I pointed to the excess capacity which existed in the industry and to the lack of response by firms to promptings repeated over many years, that rationalisation of production was necessary. Since then I have had a consultancy survey of the wool textile sector carried out with a view to determining the extent of restructuring required if employment is in the long term to be maintained at the highest level consistent with sound business operations.

Mr. Donegan

The Atkins Report.

Mr. Lalor

Yes. The survey covered the position of 20 firms engaged in spinning and machine weaving whose business is for the most part based on the home market. The consultants confirmed that the sector was in a very weak position and that an immediate programme of restructuring was essential to avoid a situation whereby closures could occur on a far greater scale than would be the case if early action was taken.

To secure restructuring of the industry in a way that would provide employment opportunities at the highest level consistent with viability I have set up a task force under the chairmanship of an executive director of the Industrial Development Authority. This task force, which is already operating will work in conjunction with the consultants and with both sides of the industry.

As an exceptional measure, in the special circumstances of this industry, and having regard also to the representations made to me by both sides of the industry I have agreed that limited and short-term financial support should be provided where the task force considered it appropriate, or necessary, to those firms assessed as not viable and which otherwise would have to close immediately or in the very near future. The purposes of such assistance are :—

(i) to facilitate the orderly restructuring of the industry and to enable the resources of the firms to be deployed to the best advantage;

(ii) to faciltate the retraining of workers for new industries which may be provided in the affected areas;

(iii) to ease any difficulties which might arise for Irish clothing firms.

Support will be limited to the amount needed in any particular case to maintain activity at not more than its present level and to discharge only those obligations which will arise during the period of support. It is for this purpose I am taking the Supplementary Estimate.

As Deputies are probably aware, receivers have been appointed to three firms. In each case it had become apparent that there was a grave danger that the firm would be forced to close at a very early date with considerable local disruption. In order to avert sudden closures, the task force made arrangements with the financial institutions concerned for the appointment of receivers. Thus the situation in each mill has been stabilised and they are in a position to remain in business for a period of time during which outstanding orders can be met.

During this period the task force, which includes representatives of the IDA, AnCO and the National Manpower Agency, will be giving priority to the provision of alternative employment in each area. I am happy to report that prospects for the establishment of new industries in the areas affected are encouraging.

I found it necessary to have the industry examined by consultants because efforts down the years to get the industry reorganised did not achieve the desired results. The consultants' report has confirmed what was generally known. We had in the sixties the Committee on Industrial Organisation Report and earlier this year the report of the Committee on Industrial Progress setting out the position in broad terms. Indeed, the latter report stated plainly and I quote chapter 7, paragraph 7.5:

reductions in the number of firms in the industry and in the level of employment are inevitable. We would urge that this be regarded as a fact of life in the industry, by trade unions and in official circles and that every effort be made to anticipate this situation and to plan for it in an orderly way.

That is what I am now seeking to achieve. In making arrangements to have the industry examined with a view to formulating a scheme for its restructuring, I was, to a considerable extent, acting in conformity with suggestions from both sides of the Industry. An impartial examination was required if the industry was to break out of the old mould. Now that the restructuring proposals have reached the implementation stage I would ask all the parties concerned to continue to co-operate to ensure that the measures being pursued to put the industry on a solid footing will succeed.

In regard to pressure for the publication of the consultants' report I wish to place it on record that whilst the report has been furnished to the management and trade union interests concerned it has not been issued generally for the reason that to do so could result in closures and loss of jobs which may otherwise be avoided. Both sides of the industry have been fully informed of my views on this.

Some Deputies have raised in the House the question of circulating the report to individual Deputies representing constituencies where woollen mills are located. I have, as promised, given consideration to this request but I have reached the conclusion that it would not be proper or in the best interests of the industry—including the interests of the workers—to provide copies as requested. The report contains recommendations involving fairly substantial restructuring. These proposals will necessarily involve detailed consultation with and between the parties concerned and such consultations would best be carried on in conditions of ordinary commercial confidentiality. Publication of the report would, without doubt, make the task of securing restructuring infinitely more difficult.

Mr. Donegan

I have it. I am sure Deputy Tully has it too.

Mr. Lalor

No problem. I would like to emphasise that the purpose of the restructuring exercise is to save jobs, and to safeguard the greater part of the sector, not to create redundancies. Factories are not being closed by my Department or by the consultants. Where they do close it is due to the pressures of commercial realities. Indeed, some of the mills at present facing closure have been kept open this long only because of the support provided by the Government.

The programme of industrial development approved by the Government calls for the creation of new jobs, through the establishment of new factories and the growth of existing sound firms, on a scale sufficient, not just to compensate for the redundancies, but to provide for a substantial net increase in industrial employment over the next five years.

The principal impetus to industrial growth continues to come of course, from the Industrial Development Authority and, in the mid-west region, from SFADCO.

Our entry to the EEC should, in the long term, enhance the attractiveness of Ireland as a location for foreign investment. It is, accordingly, of paramount importance that these bodies should increase their efforts to realise this investment potential.

To prepare for this development, the Industrial Development Authority have intensified their marketing and promotional activities and have augmented their offices at London, Paris, Cologne, New York and Chicago, and have now opened an office in Tokyo. The authority are carrying out research studies to ensure that maximum benefits are being obtained from their considerable investment deriving from the capital budget.

A sum of £1,363,000 is provided in the Estimates before the House to meet the administration and general expenses of the IDA, as compared with £1,302,000 for 1971-72. A sum of £28.2 million is provided to meet the capital expenditure of the authority, as compared with £27.75 million for 1971-72. Capital expenditure by the authority consists mainly of grants towards acquisition and leasing of fixed assets and the cost of development of industrial estates, the building of advance factories, and the acquisition of factory buildings, sites, et cetera. Provision is also made for the payment of research and development grants, interest subsidies and for the acquisition of shares in industrial undertakings.

The broad categories of expenditure are—grants to large and medium industries—£17.3 million— re-equipment grants—£5.6 million— and the industrial estates and advance factory programme—£3.5 million. The provision for administration and general expenses of the Industrial Development Authority has had to be reviewed upwards and I shall be coming to the House for a Supplementary Estimate when the precise requirements of the authority are finalised. The additional moneys will be required to enable the authority to increase intensive promotional and direct campaigns in order to generate more serious industrial enquiries and step up the rate of job creation in the present situation. Despite the EEC referendum decision, the marked up-turn in the US economy and the authority's intensive promotional and direct compaigns there has not been the expected up-turn in the number of serious inquiries now being received by the IDA. I consider that the increased efforts of the IDA to remedy the current situation are absolutely essential if we are to meet the employment targets set by us.

The IDA's regional industrial plan for the five years from 1973 to 1977 proposed the creation of 55,000 new jobs in industry in that period. Allowing for projected redundancies of 17,000 in the same period, the target for the net increases in industrial employment was 38,000. Because of the higher rate of redundancy which we must now expect, the number of new jobs created must be increased above the 55,000 proposed in that plan. It was because of this and the sluggishness in the receipt of new inquiries, partly no doubt due to the situation in Northern Ireland, that the decision to intensify the promotional campaign of the authority has been taken.

During the year ended 31st March, 1972, 67 new industries with an estimated employment at full production of aproximately 8,100 workers were approved for grant assistance. The IDA investment in these projects is estimated at £12.3 million towards a total capital investment of £39.5 million. It is estimated that projects approved under the small industries programme during the year will provide an additional 1,200 new jobs, while re-equipment grants towards modernisation of factories, plant and equipment are reckoned to provide employment for about 1,000 additional workers.

Development of the industrial estates at Galway and Waterford and construction work on the advance factory programme continued successfully during the year. Expenditure amounted to approximately £1.85 million and a total of 202,000 square feet of factory space was completed. A further 54,500 square feet are at present under construction at the Waterford industrial estate and 160,000 square feet at 13 locations under the advance factory programme.

The Industrial Development Act, 1969, assigned to the IDA the additional objective or regional industrial development. The authority have established an office in each of the nine planning regions—except the mid-west where the Shannon Free Airport Development Company act as the agent of the IDA and where a plan is already in operation. These regional offices, in addition to their development role, are part of the IDA's aftercare service to manufacturers—to help them overcome any difficulties they may encounter in the early years of operation.

The Shannon Free Airport Development Company Limited administer the affairs of the mid-west region, which involves Clare/Limerick/North Tipperary, as well as the affairs of the industrial estate. Progress continues to be made in the region and while the industrial estate has recently passed through a very difficult period due mainly to a recession in two key markets—the USA and the UK—the position has already started to improve and future prospects are good. Known incoming industry and expansion of existing industry are expected to provide upwards of 1,000 new jobs by the end of 1973.

For the current year the company are to be given a non-voted capital allocation of £3.74 million in addition to the moneys voted to them in my Department's Vote.

It will be seen then, that very substantial funds are being devoted to the vital area of new job creation. However, the attraction of industrial investment is now a highly competitive international business. Success cannot be assured simply by increasing the amount of money available to pay grants or to provide advance facilities. Foreign firms with plans to expand their activities can shop around and there is no shortage of national agencies anxious to convince them what the country of their choice should be for their new factory. Many factors influence investment decisions of this kind. Wage levels, labour availability, political and economic stability, market access—these are all important factors which sometimes weigh more heavily than the package of financial incentives available.

I am glad to report that industrial exports maintained their steady increase in the past year. This rate of expansion was achieved in spite of difficulties in some of our main export markets which I have mentioned earlier and despite also the sharp decline in exports of metal ores. Industrial exports constituted 52.6 per cent of our total domestic exports. Manufactured goods maintained a strong upward trend, rising by £32 million. Major contributors were textiles and apparel, transport equipment, tyres and tubes and professional and scientific equipment, but most other classes of goods showed increases also.

Of our main export markets, Britain and Northern Ireland took some 66 per cent of total exports. Manufactured goods exports to this market increased by about £19 million. In the second half of 1971 a small favourable balance resulted from trade with Britain and Northern Ireland.

In the USA, our second largest market, a tendency to seek protection against imports, and particularly the import surcharge during part of the year, made conditions difficult for Irish exporters. As a result, exports to the USA increased only slightly overall; manufactured goods exports to this market increased from £34.6 million, to £34.9 million.

Exports to the EEC showed a decline, explained by the drop of £4 million in exports of ores and concentrates, caused chiefly by a fall in prices. However, manufactured goods exports to these countries were £30 million, as against £27 million in 1970. It is clear that this rate of increase should be greatly improved when duties against us come down following accession to the enlarged EEC.

To sum up, it is encouraging that the growth in exports of manufactured goods has continued despite difficulties in some of our markets. As regards the situation in 1972, the first nine months' trade figures show a continuing upward trend in manufactured exports. If we can continue to keep cost increases within balance I am confident that the results for the whole year will be satisfactory.

While in no way neglecting other export markets, Córas Tráchtála are naturally concentrating much of their effort on preparations for exploiting the opportunities in Europe which accession to EEC will present. The recent opening of their new Brussels office is a major step in a programme which includes special market studies in EEC countries, seminars and lectures for exporters at home, group participation in trade fairs and numerous other measures, directed by a special headquarters section for EEC matters and backed, where necessary, by CTT's incentive grant schemes. The board's planned opening of an office in Milan in due course will give extra impetus to this work.

In their advice to exporters on preparing for European free trade Córas Tráchtála continue to urge the enormous importance of product development and adaptation to meet market requirements, of sustained promotional activity, market research and design improvement. Córas Tráchtála are of course, also continuing and increasing where necessary, their promotional efforts in other promising markets including the USA and east Europe.

The development of our mineral resources should also benefit from EEC membership. In this field there has been no slackening in interest in exploration and development. Some 770 prospecting licences were current at the end of November, 1972, compared with about 650 at 31st December, 1970. Exploration activity is now becoming intensive with companies concentrating on the detailed investigation of small areas rather than general surveying of larger areas.

Total production of concentrates in 1971 at the lead/zinc/silver mines at Tynagh, County Galway and Silver-mines, County Tipperary and the copper/silver/mercury mine at Gortdrum, County Tipperary amounted to 281,603 tons and was approximately 70,000 tons short of the production figure for 1970. Due to a sharp decline in metal prices, marketing difficulties experienced by one mine and another mine being out of production for part of the year because of an explosion and a strike of workers, the financial return was less than anticipated. The value of exports of metal ores and concentrates in 1971 was £14,415,000 compared with £18,500,000 in 1970. Metal prices are now showing signs of recovery. Production commenced in mid-November, 1970, at the reopened copper/pyrites mine at Avoca, County Wicklow and the mine is trading. To supplement the underground source of ore, the operators have proposals to mine open pit material from one area of the deposit. Other discoveries, including a promising lead/zinc deposit at Nevinstown, County Meath, are still under detailed investigation. The value of exports of barytes rose from £929,710 in 1969 to £1,122,000 in 1970 and amounted to £1,107,000 in 1971.

I am, perhaps, expected to comment on criticisms this year of mining policy though some of the more extravagant statements have received already more attention than they merit. It is desirable and, indeed, necessary to say once again that expropriation of private property advocated by some of the critics is not a policy of this Government and I am quite sure that it would find no favour with our people. It is necessary to put this on record because so much of our recent economic progress and the expected development in the future depend on our attracting to this country foreign capital, knowledge and experience to supplement our native resources in these fields.

I have already said in the House that I have set up an inter-departmental committee to review royalty and taxation arrangements for mining. I considered this necessary as it appeared to me that existing arrangements which had evolved over the years needed to be looked at in the light of increasing evidence that, contrary to what we had been led to believe, the country was in fact a rich source of minerals. I am, of course, anxious that the State should get an equitable share of increasing mining profits without, however, inhibiting the continued development of our mineral resources. The report of the review body will help me to achieve this aim. While on this subject I may say that any estimate of the return to the State from mining enterprises not yet the subject of leases from me is mere speculation.

There is considerable interest in petroleum exploration and development in the country's area of continental shelf. Under the terms of the 1959 oil agreement, as amended, Marathon Petroleum Ireland Ltd. hold exclusive petroleum exploration and development rights in three offshore areas. Following completion of detailed seismic surveys, the company were granted petroleum leases, one in 1970, another in 1971 and two in 1972 in respect of areas off the coasts of Cork and Waterford. Drilling is proceeding. One more lease is in process of being granted. None-exclusive petroleum prospecting licences for general surveying of the balance of our designated shelf area have been issued to 20 companies. I have approved the grant of licences to a further 16 companies and applications from 13 other companies are being processed.

Reorganisation and expansion of the geological survey to meet the present and future needs of mineral development in this country is proceeding satisfactorily. An item of interest is that a complete aerial photographic survey of the country is to be undertaken shortly.

The last of the major topics which I propose to deal with at this stage is prices. Deputies will be aware of the developments which have occurred in relation to price control.

In October, 1971, I established the National Prices Commission to keep under review the prices of commodities and the charges for rendering services and to advise me in relation to those prices and charges. All price increase applications received by me are referred to the commission for their advice. The commission have also initiated many investigations and surveys of their own.

The commission have to date issued 11 reports, at monthly intervals describing the very considerable progress they have made. As the commission circulate copies of these reports to Deputies, they will be well aware of the wide-ranging nature of the commission's activities and of the nature of the commission's recommendations.

Many of these recommendations made by the commission will not be welcomed by some people but they will certainly be welcomed by others. This is in the nature of price control; that to be popular it must also be unpopular. For my part I am glad to pay tribute to the impartial way in which the commission have performed a difficult and thankless task.

The Prices (Amendment) Act, 1972, became law on 24th July, 1972. This amending Act widened considerably the scope of the prices legislation to embrace many activities not covered by the Prices Acts of 1958 and 1965. The Act has greatly extended the range of activities which at present come within the purview of the National Prices Commission. With a view to assisting housewives to identify where best value for money is available and, thereby, to improve the quality of competition in the retail trade, I have made, on the advice of the National Prices Commission, the Retail Price (Food) Display Order, 1972. The order came into operation on 1st July, 1972. It requires all retailers to display prominently in their premises their prices for specified weights and measures of flour, butter, eggs, potatoes, beef, mutton, bacon, pork and oranges. I intend to maintain a rigorous enforcement of this order.

I have also made, on the advice of the National Prices Commission, the Retail Price (Beverages in Licensed Premises) Display Order, 1972, with effect from 20th November, 1972. This order requires the prominent display in all licensed premises, including hotels and off-licensed premises, of the tax inclusive prices at which all intoxicating liquor and non-alcoholic beverages are sold whether for consumption on the premises or elsewhere.

Prices, like taxes, affect us all in a very sensitive area—our pockets. It is understandable that there should, in the present inflationary climate, be widespread concern about price increases and, indeed, the problem is a worldwide one at the present time.

However strongly we may hold views on the subject of price control, we must accept certain hard facts. In the present circumstances, with domestic costs and wages constantly increasing, with the impact of market forces at international level on agricultural and other products and with the effects which world wide inflation and currency variations are having on the cost of imported materials, increases in prices cannot be avoided. Anyone who reads the published monthly reports of the National Prices Commission will see that, even after the most careful and critical scrutiny by this independent body, increases on wide ranges of products have to be authorised if the production and employment of the Irish firms concerned are to be safeguarded.

Price control at retail level is, by definition, extremely difficult. In one of its first monthly reports, the National Prices Commission dealt at length with this problem and concluded that anything approaching rigid control over a wide range of commodities would not be practicable. The vast number of retail outlets, the variety of products, packages and quantities offered for sale, the normal competitive practices which produce variations from shop to shop and even from day to day on the same premises—these are only a few of the many problems which arise.

I have mentioned these and other factors because sometimes the public may be led to believe that everything would be perfect if we had more orders, more inspectors or if other, less orthodox, forms of control were tried. This over-simple approach is no help to anyone. On the other hand, well-publicised public concern and the efforts of various responsible organisations and bodies to induce the public to resist unjustified price increases are valuable weapons in our campaign to moderate increases. I intend to maintain and strengthen our price control efforts in every reasonable and feasible way open to me and to the Government.

I have recently received the interim report of the committee of inquiry into the insurance industry in regard to motor insurance. I propose to have the report published. It has been sent for printing and I expect that it will be available generally in about a month's time. I have requested that the report should be examined in my Department as a matter of urgency. The committee will now concern itself with an examination of the other classes of insurance.

As I indicated at the outset of my remarks, I regard the topics I have dealt with as being of particular importance at the present time—certainly, they are the matters with which I have been mainly preoccupied in recent months. There are, of course, many other important matters with which my Department is concerned and I have no doubt that, if any Deputy wishes to have information on a particular question which I have not covered, he will raise it with me. I shall do my best to deal as fully as possible with any matters so raised during the course of my reply to this debate. I commend this Estimate to the House.

Mr. Donegan

I move: That the Estimate be referred back for reconsideration.

I am moving this motion because the Minister has read out a diatribe given to him by a number of civil servants and he has not expressed himself on policy as he should have had. In Parliament some of us have no power. We on this side of the House have no power. Others have power. Those of us who have no power take a certain advantage in that we can say what we would like to do, knowing that we cannot do it but if I were in the Minister's shoes I would take the criticism and the praise that might come from it and I would produce a speech on the Estimate. He has not done that. He has said exactly what I would expect him to say. He has not prepared a speech himself but has taken it from his advisers and that is not the way to do it. He has to vote himself probably before next May and other people have to vote for him. He has to "cock himself up" as Minister for Industry and Commerce, as somebody who is going to do something about it. He has not done that. He has read a speech which was prepared for him. He probably never saw it until he stood up to read it. It is very difficult to criticise that speech because the best brains in the Department of Industry and Commerce prepared it so obviously it is not a bad speech. It is a very good speech. At the same time, you have to think about brains for a start and a bit of guts as well and decide whether or not you are with the faceless men who produced this speech and then you have to decide which way you are going. I intend to decide about this one way or another.

I am amazed that all the brains of the Department of Industry and Commerce have stultified themselves by not once mentioning the Dublin Stock Exchange. My view is that the day when the fellow who is earning £20 or £30 a week happens to buy £500 worth of a certain share to lose or win is the day when Irish industry will be on a sound basis. You can take all the Industrial Development Authority grants you like and all the Industrial Credit Company loans and you are talking about something that is far less than the amount of money passing through people's pockets which is available for investment. I am amazed the Department of Industry and Commerce have not adverted to this.

This is a private enterprise society. We have got on the Minister's side and on our side various people who have an idea that you can do things in another way, that you can, say, not have a private enterprise society, not pay taxes and at the same time carry on. This is not on. This is a private enterprise society and this country must expand, look after itself, employ people on the basis that it is a private enterprise society and they must pay their taxes. That is highly important.

We have had statements from the Minister and the IDA but we have not heard anything about the Irish Stock Exchange. What is the position when a man wishes to invest £100, £200 or £300? In New York he would not have any trouble in putting in or withdrawing that money. If Irish industry is to succeed it must depend on the Irish people. In Denmark if one wants to invest one can put 1 per cent of profits into a fund and in the following year this amount can be increased to 2 per cent or 3 per cent. After about five or ten years the workers own the industry but I do not think that is on for this country. I should like to have worker participation but we must remember this is a private enterprise economy, as in France, Belgium, Italy, the United States and Britain.

With regard to the matter of insurance, I should like to point out that a series of questions by me in this House got scant coverage in the Press. At the moment young people cannot get car insurance and I think the Minister will have a lot of trouble on his hands. The Minister sits and does nothing about the matter; in fact, he appears to be happy with the situation. In 1964 there was an Act whereby all the insurance companies paid for the one company that was not able to pay. This might happen again and I warned the Minister two months ago about the matter. The young people who need motor insurance must get it and it is the Minister's job to see that they obtain insurance.

With regard to redundancies, may I repeat what I have said previously, namely, there is more joy about five new jobs than there is in saving 1,000 existing jobs. I am sure the Press will not print that statement because it is not colourful enough but it is a statement of fact that cannot be denied. This year 11,000 people were declared redundant. We voted for entry into the EEC and we must accept that there will be redundancies. It is my view that it will not be possible to create new jobs to match the number of redundancies. The IDA programme for 1973-77 is clear but in the first few years we will take a terrible beating. In making this statement I am trying to be helpful to the Minister. We will not win this year or the next year but in the following year we should get to the stage where we can match redundancies by new jobs. However, it will cost an enormous amount of money. We must accept that we will lose this year and most of the following year but after that things should balance.

I have quoted ex tempore article 1, subsection (5) of the Anglo-Irish Free Trade Area Agreement and Article 236 of the Treaty of Rome. I would ask the Minister if he has read those articles?

Mr. Lalor

I have read the articles but I cannot quote them ex tempore. However, I am willing to hear what the Deputy wants to say.

Mr. Donegan

The Minister can read the articles before he replies and he will find I am right. Article 236 of the Treaty of Rome provides that the small countries can do their job on getting a little bit of privilege on their employment situation. Quite clearly— I have said this before—if we have not got backroom boys in the Department of Industry and Commerce deciding how we can under the Treaty of Accession, the Treaty of Rome, the Anglo-Irish Free Trade Area Agreement and under the article to which I referred, organise to ensure that not one job will be lost then, like the law, we are an ass. I understand we have not got them. We are an ass if we have not got these people organising to ensure that the very best shall be got for the most humble worker in the most out-of-the-way part of the country. That is what we have got to do and I am not satisfied that it is being done. I am dissatisfied with the situation.

I accept that under the Anglo-Irish Free Trade Area Agreement and the Treaty of Rome there are probably 11,000 redundancies on the cards. What is the Minister doing? The situation would be very sad for the 11,000 affected. This is something few people would say, but I acknowledge that this is the situation the Minister will have on his hands. It is a problem. I do not wish to take advantage of it. It is one of those things we have to live with. But what are we going to do about it? The lark of the Minister going down and opening a set of petrol pumps, and all that kind of cod, is over. How can we face the fact that 11,000 redundancies are on? What are we going to do?

I believe it is a question of work by the Minister, by his staff and by the various Government agencies who will have to do their very best to produce 11,000 new jobs to cater for these redundancies. I do not believe they will succeed. This would be a three to four year task. Possibly I am now letting the Minister off the hook, but we, on this side of the House, are concerned with the truth, and my boss told the truth a week ago. It is clear the Minister cannot replace 11,000 redundancies with 11,000 new jobs. The Minister may contradict me and say that it will not take him three to four years to carry out this task and that he will do it in two years or 18 months, but my considered view, as a businessman, is that the Minister cannot do it.

I come now to the local situation. I represent Louth. I believe I will head the poll at the next election. I believe I will be around 1,500 votes ahead of the Minister for Education. That is the normal number of votes I get over him because of my work. No problem, as the Minister for Transport and Power would say.

Mr. Lalor

The Minister brings in a colleague along with him, of course.

Mr. Donegan

The colleague was shot in 1916, or something, and, when he is gone, it will be a different ball game. I was chairman of the Louth County Council and a member of the regional development organisation for Louth, Monaghan and Cavan and of the health board for Louth, Meath, Monaghan and Cavan and over the last several months I have been reminded very forcibly of the situation of the infrastructure. The infrastructure is quite clearly a matter of roads, telephones and water. The supply of water in Dundalk, with a population of 20,000, is quite inadequate. In Drogheda, with a population of 18,000, all the water required is available. We have done a very good job on the new £11 million cement factory. In two years' time Drogheda will be home. It is a different story in Dundalk. They have not got enough water. The chairman of Dundalk Urban District Council opened a new water scheme with, I may say, great aplomb and dignity and it was believed everybody would have enough water. The fact is we have not got enough water and the proposal now is to flood 45 acres and produce water from Lake Muckno, the Lake of the Swimming Pig. That will produce enough water for Dundalk and for all the industries that can be placed in Dundalk. If this is the course of events it will be a very good thing. The infrastructure of roads, telephones, et cetera is very important. If I speak about telephones I will probably be a bit off the Estimate.

Mr. Lalor

A day late. We were on telephones yesterday.

Mr. Donegan

I placed eight people in a factory in Dundalk which is exporting exclusively to America. If the Minister looks up his figures he will see that a grant of £1.3 million was given. I do not know how much was collected. We do not name names.

Mr. Tully

There are a lot of industries in Louth.

Mr. Donegan

The Minister knows it very well. During my political operations or, should I say, my friendly operations, I sat and saw this man ringing three different people in America. If he wanted to get in touch with the factory to which the Minister gave a grant of £1.3 million, five miles away, he would be better off cycling there than telephoning.

Mr. Lalor

The Deputy said he got three calls from America while he was there.

Mr. Donegan

Yes, but he could not get one to Dunleer or to Drogheda. It is all right for the Minister to be smart. At 8.30 this morning I put through a call to Rhum. I got it within three minutes. It was to a gentleman called Stevenson.

Mr. Lalor

That call went through Dublin.

Mr. Donegan

Then I put through a call to Dublin and I left my house three quarters of an hour later and had not got it. What will a businessman do if he has to decide whether he will take a grant here and enjoy the tax benefits until 1980? I can telephone Rhum in five seconds but I cannot get through to Dublin. The Minister's party are responsible for that.

Three years ago a certain port was not going so well owing to a certain situation and I advised the investment of certain funds. We did not succeed in getting it going. I was not involved in it but if it had been done and if the Minister could get the people of Ireland to put money in, believing in the situation as it is, there would be real industrial development in the country. I had certain views about six months ago and I decided I would take a certain line. I borrowed some money and removed a certain sum from where I had it and invested it in a certain company. I was right. What I should really like to see is the ordinary person down the country becoming interested in Irish industry and investing £50, £100, £150 or, perhaps, £200. In the place from which I borrowed the money to invest I was told that if I knew anybody willing to invest he would be given an attractive interest rate. I put £6,000 from the parish of Monasterboice into that business, money that had been lying in the bank and in saving certificates. That is the place to put it and it will make the Minister and the Department do their job.

There must be capital investment but, first of all, there must be the infrastructure. All that was contained in the Minister's introductory speech was stuffing. I am very fond of turkey stuffing and all other kinds of stuffing but not of the kind contained in the Minister's speech. He read out what he was given to read and expressed no opinion of his own. More companies must become public and more people must invest. If a man takes home £10 and spends £9 he should invest the remaining £1. That philosophy is accepted in New York, Chicago and Boston but there they have reached the stage where they are gambling. That should not be the position here. At the same time, if we are to have a private enterprise economy we must take our chances when we invest. The Minister has not even talked about that. As far as he is concerned it is a closed shop. We have Guinness's shares, the Dublin Port and Milling Company shares, Allied Irish Investment Banks shares, and so on, and no one in Killarney ever heard about them.

Mr. Lalor

Shanahan Stamps.

Mr. Donegan

That is a very asinine interruption.

Mr. Lalor

Killarney reminded me.

Mr. Donegan

I am talking about the different companies that exist and that grind out bread, and produce meat, and produce clothes. If a man in one of those companies has £50, why should he not have the right to invest? Has the Minister mentioned that? He does not even know what I am talking about. He has just read out what the boys behind the rail told him.

In Dundalk AnCO are starting a retraining centre. Retraining is most important. I have accepted that the number of redundancies, 11,000, is a fact of life. We must think about the retraining of workers. I brought eight people to a certain company and I think I have replaced them. People who are not up to scratch cannot be replaced by me or by the Minister. We thank the Minister for the AnCO retraining centre which is starting in Dundalk. We are not churlish about that. The AnCO operation is highly expensive. I would say that in certain situations the AnCO levy on profits or on turnover, is far above the net profit. It is very easy for civil servants, or for the Minister, or others, to say that AnCO is 1 per cent off, but it is very difficult to pay this money. Sometimes it is not only difficult but improper.

The Prices Act, 1972, was introduced by the Minister and then he removed section 3 under which the price of houses was controlled. I am not interested in whether a £20,000 house is controlled. I am interesed to ensure that the boy and girl who want to get married, and who have very little money, will not have to pay too much for a house. Section 3 of the 1972 Act provided that a house was a commodity and, therefore, could be controlled. I could not care less if a person who wants a £20,000 house has to pay £30,000 for it. I am interested in the young married couple who have very little money.

As I said, section 3 defines a house as a commodity which can be controlled. It was removed three weeks before the Mid-Cork by-election. During the Mid-Cork by-election I saw one of the biggest builders in the country canvassing with the Minister for Local Government. How mean can we become? If I were looking for a grant or a loan, I would not think of going within 1,000 yards of the man who might be deciding whether or not I would jump into the River Liffey this evening.

Mr. Lalor

The Deputy is making assertions against the Minister for Local Government who is not here.

Mr. Donegan

The Minister is responsible for the Prices Act, 1972. As spokesman on Industry and Commerce for Fine Gael, I am also responsible, and I will accept my responsibility. I will not accept that the Minister is the boss, that he does the job, and that is that. The two of us have a responsibility. As well as being responsible I am also disgusted at what happened. The Minister for Local Government said that he would not pay the grant, even though the measurement of the house was correct for grant purposes. I do not agree with that because I think that the number of people who are going to buy houses, the boys and girls who are married or intend to marry and to buy a house, and who will buy them at the price offered to them, will be affected to an extraordinary degree by the removal of section 3 of the Prices Act.

I want to talk about that section. Why can the gentleman on the Press Gallery go down to the General Office tomorrow and ask for the Prices Act of 1972 as introduced and find that section 3 defines a house as a commodity and then find that at the last stage section 3 is removed? The Minister's party have been very lucky inasmuch as the mid-Cork by election produced a great avalanche of ideas and news, with the result that this was put in the background. How can the Minister meet his officers in the morning——

Mr. Lalor

It proves that the Minister for Local Government does not spend all his time with who-you-know.

Mr. Donegan

Please——

Mr. Lalor

I am only making a crack.

Mr. Donegan

I want to find out something. I do not care if I am out of this House tomorrow—I would be very much better off. I am the third generation without a break in politics and having said that, I want to say that for a Minister of State to be seen with a person who had an interest, walking around in a by-election, would in Britain be a reason to resign. I am being quite specific in what I am saying, putting it word by word and letter by letter. If in the Prices Act a house is defined as a commodity—I suppose there are a million or nearly a million houses in this country—and if I find that one of the biggest builders of houses—and I am a private enterprise man, utterly and completely—can be seen during a by-election with the Minister for Local Government, who has the right to decide whether or not on appeal planning permission will be given for 100, 300, 500 or 2,000 houses, it is time the Minister or the man in charge of the Act, the Minister opposite, or the Government should resign. It is for them to decide what they will do and they can do what they like, but go to section 3 of the Act of 1972 and you will find a house is defined as a commodity.

Yesterday I was at a board meeting of a certain company and I found that a commodity had had a 90p increase, and a 25p increase, and I think a 38p per ton increase. I asked if they had increased and I was told "no, they have not but will in the next fortnight; we have some stocks and we are carrying on". That is the sort of discipline we are subjected to but why is it that the boys and girls of this country have to find themselves in the situation in which a house is a commodity and then it is not? What do we wear? What do we eat? What do we live in? I do not care about the £20,000 or the £30,000 house—these people can pay £22,000 or £32,000 or £18,000 or £28,000—but I do care very much about the real price of the normal three-bedroomed house in which boys and girls getting married are going to live.

An Ceann Comhairle

The Minister is not responsible.

Mr. Donegan

I refer you, Sir, to section 3 of the Prices Act, 1972, and you will find that I am right. You realise that during my 18 years here, I have always been entirely subject to the Chair and always with the Chair, but I refer you, with respect, to section 3 of the Prices Act 1972. This was the greatest sin ever committed in my time in Dáil Éireann. That the biggest builder in this city and in Cork was canvassing with the Minister for Local Government, with section 3 of the Prices Act, for which the Minister is responsible, removed one week before the mid-Cork by-election, to me was a horrifying situation. Knowing the man well I went to him and said: "Will you for God's sake have a bit of sense and go home? Whatever has happened, forget about it and go home." I will not mention his name. He did not go home but I do not think he understood what he was doing. We think about the situation in England and the last occasion which gave rise to a resignation, the previous one being the John Profumo matter. These resignations were on the basis that people who were in government had behaved improperly. What annoys me is that the Minister continues in office and takes no account of what has happened in relation to the Prices Act, 1972. If I found myself in that position, I would relinquish my office immediately. Let us consider what happened in relation to section 3 of the Prices Act, 1972. I have been in politics long enough to know that when it is proposed to introduce a Bill, the proposals are circulated to every Department of State. Therefore, the proposals for the Prices Act, 1972 were sent to the Department of Finance and Local Government among others, they having emanated from the Department of Industry and Commerce. The source of power is the Cabinet meeting at which the views of the different Ministers on any proposal are made known. Then, if there is no objection to the proposals, the Bill is brought before the House. In my view, the Prices Act, 1972, was not a bad measure but, having said that, we must consider section 3 of the Act. In this section a house was defined as a commodity. The Minister accepted responsibility for the circulation of the Bill as it was then. Of course, it is for the Cabinet to reach a decision on any proposal and sometimes they can avail of the opportunity of reaching decisions that are popular. On the basis of the control of prices, the Minister is entitled to some praise for the Prices Act but in respect of section 3 of that Act there is no praise due to him. One reaction to the Bill was that builders who were constructing, say, 10,000 houses in this city, were capable of saying to the Minister that he is only a small man and that section 3 of the Bill must go. During the by-election campaign in mid-Cork I found a person who must be the biggest builder in Dublin or in Cork, canvassing with the Minister for Local Government. Section 3 of the Prices Act, 1972 has much relevance to what I am talking about although it is possible that what I am saying will not get into print. The point I am making is that the ordinary three-bedroomed house, of which we see hundreds in a row and into which young couples go in the hope of being able to leave them after five or ten years, is the type of house that has been excluded and which is no longer defined as a commodity. This is a public disgrace, the greatest disgrace that we have ever known.

I mentioned speculative gains tax and in this respect I wish to define my party's position on this question. Press reporters are a group of decent fellows but there are times when one must decide whether what is published is true. Therefore, I would like to take this opportunity to define my party's position in respect of capital gains tax. As we said in 1965 and in 1969 that we would look at the situation but the Press reports of this suggested that we would produce a speculative gains tax. I do not think that the Minister will take advantage of me on this matter when he is replying because neither he nor I take advantage of each other.

Mr. Lalor

The Deputy has been lacerating me for the past half hour.

Mr. Donegan

Fine Gael will look at the situation regarding speculative gains tax but they have no definite commitment to produce such a tax. Regarding wages and salaries and management, we hear many young mohair-suited moguls saying that management is wrong, that the old boy is always wrong and should be got rid of. This may be true in some cases but it would be very wrong to adopt such an approach in general. There are certain people in all political parties who can produce statistics and figures, but their conclusions are not always right. People who have served in the hard school of experience can often find a way through difficulties. In this country industry is dependent on the management teams. I am nauseated at the way people say "Paddy Lalor is no good, and Paddy Donegan is no good, and Jimmy Tully is no good. Get rid of them all." These statements are not necessarily true. This morning I dealt with a situation where I was told to get rid of a certain person and a factory would do better. I do not agree with that. It is not that simple. Older men have often expertise which can be used to good effect.

Mr. Tully

The poor old boy will not be too happy when he reads that in tomorrow's paper.

Mr. Donegan

The middle-age group have much expertise. There are too many young moguls with mohair suits around the country. If I were Minister for Industry and Commerce, I would make decisions so fast that people around me would not know what was happening.

It is unfair that Fóir Teoranta or the IDA should walk into factories and say that one should get rid of a certain old person and that the situation would be all right then. The man I am thinking about is the "whole guts" of the concern. He is the fellow who insists on the men coming in and starting at 8 a.m. and who insists on a check on output. It is being said that he should be forced to take £500 a year less and that he should be demoted. It was suggested that he should leave at 65; he has three years to go. There are people even in the Fine Gael Party who might act as advisers on industry.

Mr. Lalor

They might even want to get rid of the boss.

Mr. Donegan

The wool federation suggested giving one of them £6,000 and three years to get rid of him. We know who we are talking about. This business of saying that Deputy Lalor is a bad Minister for Industry and Commerce and Deputy Donegan is a bad spokesman for Industry and Commerce and Deputy Tully a bad managing director is a lot of rubbish. We are as good as possible and do not wish to be seen with the whizz kids unless they really are whizz kids. Many of them are no good.

I am not satisfied with Fóir Teoranta or the IDA. They are great at ensuring that they have security and at organising somebody to go into a sinking company. Then they organise a good meal a fortnight later and the job is done. I am not satisfied with industrial policy at the moment. I am not here to ensure votes for Fine Gael or Fianna Fáil. I am interested in industry.

Reference was made to a statement in the Financial Times which said that in Denmark 1 per cent of the net profit is put into a fund and that workers become shareholders. Our country is a private enterprise country. In Britain there are the coal, steel and different industries and a huge number of industrial workers. There is also colonial wealth, particularly in the South of England. One can see a Left and Right situation. One can win or lose an election on that basis. We here are in a hotch-potch situation. There are not enough industrial workers to make a difference or enough farmers either. This is the crucifixion of the Labour Party. There are not enough shades of society to make a difference in so far as industry and commerce are concerned. We must be pragmatic here. If there is a chance of ten or 100 jobs in a certain place it could not matter less whether that industry was financed by an individual with the aid of grants or whether it was financed by the State. In my view it would be better if it were financed by the individual. Where the persons £1 is on the floor he is more likely to pick it up than if it is the State's £1 that is on the floor.

The Dundalk Railway Works was in my constituency and was to be closed for reasons beyond our control. The Northern Ireland Government decided that they would not continue to have their trains, wagons and carts built or repaired there. That decision caused 1,000 redundancies. The late Seán Lemass when Minister for Industry and Commerce decided that something would have to be done about the situation. At that time Taiscí Stáit or Fóir Teoranta had not been set up. Mr. Lemass, on behalf of the Government, underwrote £1,800,000 which remained on the balance sheet of the Industrial Credit Company for four years. I am an expert on the subject. I have only to go to EEI of Ireland which is at a distance of four miles from me.

Mr. Lalor

The same applies to the Minister for Education.

Mr. Donegan

In that case the Minister for Education, Deputy Faulkner, and I should be the experts on this. In that case also we had to face up to a rescue operation. The Minister should alert himself about this. I am not too happy about it at the moment. Have I conveyed the message to the Minister?

Mr. Lalor

I have got the message.

Mr. Donegan

We were in the situation that 1,000 people in this company could pressure the Government. I could give other examples. Deputy Peter Barry, Deputy Cosgrave and I went to Verolme in Cork during the mid-Cork by-election. I was told there would be redundancies in the industry. Forty-eight hours before the by-election the Minister for Transport and Power, Deputy Brian Lenihan, was saying "no redundancies". Then the redundancies occurred. Deputy Gene Fitzgerald and Deputy Meaney put down a question about three weeks ago in regard to the redundancies in that industry. I knew before the Cork by-election that the redundancies would occur. I was told so by the executives of the industry. Deputy Peter Barry and Deputy Cosgrave were told so. If you want to get to the stage where Fianna Fáil and their Ministers can do what they like, then you are back to section 3 of the Prices Act, 1972 or to that sort of situation.

If I were a Minister I would resign within five minutes if I did that sort of thing. I would not have any part in it. I cannot use the word "lie" but I can use the word "untruth". I used it here the week before last. The Press Gallery did not know it happened and the Minister was laughing the whole way back to his constituency. How is it that a serious allegation against a Minister of State goes unreported in the papers?

An Leas-Cheann Comhairle

It has nothing to do with the Estimate.

Mr. Donegan

Do you mean to say that a serious allegation against a Minister of State in regard to the question of whether or not there would be redundancies in Verolme is not relevant to this Estimate? With respect, I say that, of course, it is. Before the mid-Cork by-election, Deputy Peter Barry, Deputy Liam Cosgrave and I were told that redundancies would occur and we never opened our mouths. We did the decent thing. Then there was the parliamentary question put down by Deputy Gene Fitzgerald and Deputy Meaney about ten days ago, when I asked supplementary questions in order to get them out of trouble, to try to correct the position. They had let the people of Cork in for redundancies and did not tell them before a by-election that redundancies would occur. How mean can one get?

Last week, on the Imposition of Duties Bill, the question of footwear was discussed. The year of review under the Anglo-Irish Free Trade Area Agreement—Article 1 (5)—started on 1st July, 1971, a year in which difficulties could be discussed. The Minister did not explain why he opened the discussions in April, 1971. He did not explain why he had not done it a year before or why he is doing it at the last minute.

I have been in a footwear factory in my constituency within the last 36 hours. This is an industry exporting exclusively to America. We can get away from the rat race on footwear but what about the people who just cannot get away from that rat race, the people who have a factory and cannot change their whole trading? About two years ago I was talking to the top man on footwear in the Common Market in Brussels. His name was M. Goretti. He told me that the biggest factory in Belgium was a privately owned factory. It was not absolutely privately owned but the shares in the factory were largely in the one family. He told me that because of their size and because of Italian imports and other problems they could not change quickly enough because they would lose so much money in changing over to a different style of manufacturing that the whole thing would not be viable. The biggest factory in Belgium was condemned to extinction and the best brains in the world could not change that. If 30 people or 50 people were concerned it could be done.

For instance, Father Campbell of Dundalk, a few other people and myself had a decision on a company called Castle Shoes which employed about 20 or 30 people. We invested very small sums in it and Castle Shoes is at the moment doing very well. It is all right to change when you are small. In the Common Market people say the big thing must succeed but that is not true. An té nach bhfuil laidir ní folair dó bheith glic. The bigger industries in very sensitive lines such as textiles and shoes will have a very difficult time indeed, not because of their excellence, not because of their administrative ability, not because of their lack of it, but because big bodies move slowly. In my constituency there was a grant for a shoe factory of £1,300,000. I am sure that people who have not heard that before are inclined to turn handsprings. Does the Minister know that?

Mr. Lalor

The Deputy already told me not to interrupt him.

Mr. Donegan

That factory is exporting to America. It is producing shoes of the very best quality. I was in the factory the other day and if I had the moral courage I would have said that I would have a pair of shoes myself at the price for which they are being sold to America. The mark-up in America is colossal. The man who really makes money in America is the middle-man.

I should like now to talk about the situation in my local area of Louth-Monaghan-Cavan. Deputy Bruton speaking last night, or the night before, in the west said that it is very stupid to have the health boards embracing certain areas and the regional development organisations embracing areas which are not similar. I agree. We should have the same areas for all these things. The infrastructure is the main thing—roads, water, telephones.

An Leas-Cheann Comhairle

The Deputy would need to relate this to the Estimate before the House.

Mr. Donegan

I do.

Mr. Tully

He did that twice in the last one and a half hours.

Mr. Donegan

It is more important to have roads, telephones and water for industry than to have grants.

Mr. Kavanagh

What about railways?

An Leas-Cheann Comhairle

The Minister has no responsibility for these.

Mr. Donegan

Is that not very sad? It is most important that we should have a good training establishment in the various areas. The Minister for Labour is responsible for AnCO but if the Minister for Industry and Commerce does not get a number of people coming forward from the AnCO training establishment he will be in a sad state indeed, in so far as new industry is concerned. We agree that we must replace the 11,000 jobs that have been lost.

On the question of mining, the policy of Fine Gael is quite simple. We believe that the State should get its fair share. We believe that prospecting licences should be granted to those who have the money and expertise to prospect. They should be given mining licences quickly so that we can get the very best out of this country by mining. With regard to Tara Mines, there is a law case outstanding and a judge of the High Court is considering his decision. Eighty-five per cent of the Tara Mines area is on one side of the river and 15 per cent is on the other side. The area in question happens to be on the 15 per cent side and the Minister for Industry and Commerce has to decide if he will give a mining licence on the basis of certain royalties.

A year ago in this House the Minister told me that this was a very good strike and that the royalties should be high and I agreed with this. The State should demand royalties on each ton of ore produced. About 20 years ago if anyone said that there was a zinc, a gold or any other mine in Ireland he would be considered a lunatic. However, it is now realised that we have precious metals but it is simply a question of whether it is a commercial prospect to extract these metals and to use them. In this case I would mention Arklow where the price of copper rose from £180 per ton to £340.

Zinc is the principal mineral in the Tara Mines. Portugal has considerable zinc resources and there is an agreement with the Common Market countries with regard to the zinc output. Zinc is a mineral that is subject to market fluctuations and it is important that we get into the trade as soon as possible. The Minister has not done his job. He should have grasped the nettle firmly and should have decided to give a mining licence to Tara Mines, leaving out the 15 per cent that is on the other side of the Boyne.

The Minister has his advisers and I am sure the legal situation is considered very carefully. However, as a certain man said a week ago: "I am not accustomed to being told by solicitors what to do; I am accustomed to telling them what to do and then paying them." The Minister should take that line and make up his mind. A sum of £2 million is spent at the port of Drogheda. Some 500,000 tons of ore are exported. We do not want to export this because if we can increase the amount we can process it in this country with consequent work for Irish people.

The Minister had plenty of legal advice but I wonder if he has courage. He should grant a mining licence to Tara Mines and allow them to produce zinc which could be shipped out of Drogheda. Perhaps in a year or two we may be able to process the ore in this country. If we do not take some steps Portugal and other countries will supply the zinc and we will be too late. If this happens the Minister must bear responsibility. It is essential to take decisions in business. I realise that a decision taken today may be the wrong decision tomorrow but if the Minister will not make any decisions, if he is content to get blueprints from his advisers but to do nothing about them, he is merely a rubber stamp. The Minister should make a decision one way or the other. The silence of the Minister on this matter, the fact that we have a few million pounds invested in County Meath but we cannot take out the goods, is a blot on the Minister's political expertise. If the Minister does not want to give a licence he should state his reasons and I am inviting him to do so.

We have agreements with the EEC regarding the supply of zinc but the Minister will do nothing. If they supply the zinc, Tara Mines will be a much less viable concern. What I would wish for, instead of the Minister across the way, is a man like the late Deputy Seán Lemass or the late Deputy Sweetman. They would decide in five minutes what it takes the Minister a year to consider. All I can do is try to bestir the Minister into doing his job. I can do no more. All the expertise behind the Minister is wasted. In my opinion the Minister, from the point of view of mining, is a disaster.

I want to deal now with gas and oil exploration off our coast. Fine Gael were well in front of the Government and everybody else, including the Labour Party, in regard to exploration for both oil and gas. The safeguarding of the people's rights is very important. People know very little about these things and the Minister has made no effort to inform them. The country owns up to 300 metres depth around our shores. Taking into account the Continental Shelf, this represents a vast area for exploration. What has the Minister done about it? With whom is he negotiating? The truth is the Minister has done very little about such exploration for gas and oil. He could issue prospecting licences and charge royalties on the gas and oil extracted. Why should we not emulate the sheiks of Araby? Why not fortify the below-the-line expenditure in the Budget with money from somewhere else? The people should reap the benefit of the country's unnatural assets. Oil and gas could be a gold mine if only the Minister would bestir himself. If I were in his shoes I would work myself to the bone. The Minister just sits there like a nice, easy bloke——

Mr. Lalor

It is an accomplishment to be able to be very effective and yet appear to be a "nice, easy bloke".

Mr. Donegan

If that is an accomplishment, the Minister is welcome to it. I would prefer to see him working. Damn the bloody bit of work you did in the last six months.

An Leas-Cheann Comhairle

The Deputy will refrain from personalities now.

Mr. Donegan

On the question of regional policy in the EEC, it would appear that we have a good chance of getting some money for the designated areas. We, in Fine Gael, produced what I believe is a sensible policy.

An Leas-Cheann Comhairle

We are dealing with the administration of the Minister's Department. We are not dealing with policy.

Mr. Donegan

I am talking about the regional development of industry, which is a very important matter indeed. If industry is not developed in designated areas the taxation levied on those living in areas which are not designated will be a truly intolerable burden. Money will have to be found for amenities such as roads, hospitals, Garda barracks, and so on, in the designated areas and, unless these areas are themselves industrialised, the burden of taxation in the non-designated areas will be quite impossible.

We must concentrate on a crash programme to industrialise the areas west of the Shannon. I know the Minister will have trouble in getting the necessary finance from his colleagues in the Department of Finance. As an aside I would suggest that in the Fourth Programme for Economic Expansion, not yet available, the Minister for Industry and Commerce should have provision for a crash programme to industrialise the areas west of the Shannon. That would not be agreeable to Deputies in the east of the country —I include myself in this—but it is the only way in which we can achieve a true programme of private enterprise economy.

On the question of Fóir Teoranta, I agree with the element of gamble in the work they are doing but I sincerely hope there will be no large failures such as Potez. At this point I should like to give a little advice to the Minister. If I were Minister for Industry and Commerce I would sack immediately one-third of the work force the Minister now has. I particularly know one of them: I had a business association with him—and I would sack him in five minutes. He knows that I know that he evaded customs duty on certain——

An Leas-Cheann Comhairle

The Deputy should keep to the Estimate.

Mr. Donegan

The most important thing about the Estimate is the administration of the Department.

An Leas-Cheann Comhairle

The Chair would like the Deputy to appreciate that he may be identifying a person. The Deputy has charged that person with crimes.

Mr. Donegan

I have been very careful not to create a situation through which any of the four civil servants in the House beside the Minister could be affected. Perhaps the Minister could identify the person I have been speaking about. If I were in his position I would sack him in five minutes. I had begun to speak about Fóir Teoranta and about the element of gamble in their make-up. In my constituency they have helped considerably and we hope they will do so again. Having said that I think it was remiss of the Minister not to have devoted more of his introductory remarks to that important Government agency. His speech was produced by somebody in the Department and it was not a politician's speech. I should like the Minister to have said what I have said about Fóir Teoranta, Taiscí Stáit, Potez and the Industrial Credit Company.

Last Monday, as chairman of Louth County Council, I had lunch with the local director of the IDA because I knew I would have to speak here tonight. When I returned to the county manager's office I found that what I had been told at lunch was being discussed. The plans were on infrastructure for industry, not for houses, not for people. The suggestion was to harness Lake Muckno, the lake of the swimming pig. It is said that when a black pig swims across Lake Muckno the world will end. The town of Dundalk will have more water than it ever had for industry from Lake Muckno. It will cost a colossal amount of money. I was talking on Monday afternoon about flooding 50 acres to provide water for industry in Dundalk. I have reached the conclusion that if you took away the grants and the tax free concessions and put in the telephones, the roads and the water you would get industry. It is as simple as this. If you put houses in a certain area, people will populate the houses and then they will find jobs. This is a simple fact.

An Ceann Comhairle

We must defer consideration of this Vote and proceed with the division called on the motion to refer back the Estimate for the Department of Posts and Telegraphs.

Further consideration of Vote postponed.