asked the Minister for Industry and Commerce the steps he proposes to take to ensure continuity of employment in industries manufacturing concrete products in Border counties following the increase in cement prices.
Ceisteanna — Questions. Oral Answers. - Concrete Product Manufacturers.
I am aware of the problems which imports from Northern Ireland are creating for the concrete product manufacturers in the Border counties. The differential between the price of cement in Northern Ireland and that applying here is an important factor in the matter but my understanding is that the price of the Northern Ireland manufactured cement is expected to increase during the coming months with a consequent narrowing of the differential. As the Deputy is no doubt aware, Ireland's freedom to take steps to restrict imports is limited by our international commitments including in particular our membership of the European Communities.
Does the Minister know that the increase expected in Northern Ireland will be very small in comparison with the increase here? Would he agree that should the nominal increase expected take place, it would still leave our manufacturers in a non-competitive position? He will agree that his Department and others have received submissions from those manufacturers over the past few months pointing out the difficulties they encounter in regard to VAT and relaxed restrictions at border posts. If he does not do something for these manufacturers, there will be wholesale unemployment which will have a large spin-off in quarries and so on.
The root cause of the difference in price is the difference between the price of cement charged by APC in the United Kingdom and Cement Limited in the Republic. APC have two plants in Northern Ireland, one oil fired and the other coal fired. They have a policy of averaging their price throughout the United Kingdom and have a very advantageous contract with the United Kingdom National Coal Board. There may be an element of subsidy in their Northern Ireland price because of their large volume in the United Kingdom and because of their policy of equalising the price throughout the United Kingdom.
The situation is as follows: the contracts with the national coal board are being currently renegotiated by APC. That will result in a considerable increase in their costs. The indications are that the resulting increase in price in Northern Ireland cement will be phased over a period rather than happening at once. It is true that APC are currently seeking a 3½ per cent price increase, which is very small, but that is not the end of the story. Press reports indicate that further increases will be sought during the spring and later and these should help to narrow, though probably not fully remove, the price differential for cement. This is a serious situation and one I would be happy to take any steps within my legal powers to deal with. There have been representations about this, but it is also fair to say that this is a situation where the inbuilt advantages of Northern Ireland cement products producers are expected to diminish quite substantially during the course of this year, though not at one stroke.
Is the Minister satisfied that the price applied for by Cement Limited, and that approved, was justified?
I share discomfort perhaps more acutely than other people, because it is necessary for me under legislation — and I have not sought to evade it — to be the person whose name is associated with this. They hurt me, therefore, in the same way as they hurt the Irish construction industry. The prices are carefully examined by the National Prices Commission which contain representatives both of the consumer interests, from the manufacturer's point of view, and domestic consumers and trade unions and they are thoroughly processed. In the vast majority of cases I have had investigated, I have very rarely been able to fault the professionalism, justice and fairness of their recommendations. Indeed, the people making the recommendations have no pleasure in them either but we cannot enter a circumstance where we forbid firms to earn profits and to recapitalise. While I have acute discomfort and no pleasure in being the statutory sanction for these increases, I am satisfied that in the vast majority of cases they are justified. Where they are not, I reexamine them.
Is the Minister——
I have given Deputy Leonard a lot of latitude. I want to get on to the next question.
I would like to ask a brief question.
The Deputy may ask a very brief question.
Did the Minister take into account the trading position of Cement Limited which was published prior to the increase?
I believe their returns on capital and profits were available to the experts for their professional scrutiny which was made in the case of their application.