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Dáil Éireann díospóireacht -
Wednesday, 16 Mar 1977

Vol. 297 No. 11

Bula Limited (Acquisition of Shares) Bill, 1977: Report Stage (Resumed).

Debate resumed on amendment No. 4:
In page 2, line 15, after "Minister" to add "which has not been made available to the Oireachtas".
—(Deputy Colley).

Last night I appealed to the Minister to accept this amendment. I cannot see any logical reason from his arguments why it should not be accepted. The controversy that has raged throughout the discussion on the Minister's proposal to ask the House to pass a Bill which refers to an agreement the details of which he is not prepared to divulge is not at issue in this amendment. The amendment seeks to have written into the legislation the fact that the agreement had not been made available to the Oireachtas during the debate on the Bill. It is essential that the words in the amendment be included in the Bill to make clear the situation under which the debate took place. The Minister referred to commercial dealings between the State and commercial enterprises and said it was his intention that the State be involved commercially with other enterprises in the future. He told us that because of that agreements entered into with business interests must be kept secret. For that reason he did not intend making the terms of the agreement referred to in this Bill available during the course of the debate. He also expressed his intention of never making such agreements available to the Opposition when future Bills of this type are debated.

The Minister has performed a major cover-up during the course of the debate regarding the details of the agreement but it is worse that he is persisting in refusing to accept an amendment like this. He is trying to cover up a situation he created during the course of the debate. He does not want to make the terms of the agreement available to the House nor does he want that fact written into the legislation. This is the second coverup we have had and I cannot see any logical reason for this one. If one reflects on the debate that has taken place on this Bill so far one must be struck by the fact that were it not for the investigations carried out by Deputy O'Malley and his diligence in seeking information this would have been the greatest farce of a debate ever to have taken place here. If no facts had emerged during the course of the debate in relation to what was contained in the agreement, we would have had the most unreal situation imaginable. The House and the country must be grateful to Deputies O'Malley and Colley for pursuing the Minister during the course of the debate, not that he let very much slip—he did on one or two occasions. The research carried out by Deputies on this side has helped put some information in relation to the agreement on the record even though the Minister tried to have it excluded.

Since I became a Member, I have never seen a Minister attempt what the Minister for Industry and Commerce has done in this debate.

I should like to dissuade the Deputy from making a Second Reading speech on Report Stage.

I am appealing to the Minister to accept this amendment which will not change the terms of the Bill. The amendment seeks to have stated in the Bill something which the Minister has admitted is true, that the agreement was not made available to the Oireachtas. The debate would have been a farce were it not for the diligence of members of the Opposition in their research. There still remains an area of doubt regarding the major provisions in the agreement. The Minister has asked the House to sanction the spending of £10 million which will be handed over to certain individuals. Some of the individuals who have been listed during the course of the discussion and whose names are now to be written into the Bill in accordance with amendments that were accepted last night are persons for whom I have the highest admiration, people who, through their business acumen and hard work, have helped to build up this country from a very weak industrial base over a period of 30 to 40 years.

The Deputy is going back on an amendment which has been disposed of.

I am merely stating that in rising to speak I am in no way being critical of the individuals who have been named in the Bill.

That amendment has been passed.

They have not been named up to now. I want to put that on record. If we had more people like Mr. Tom Roche this would be a better country. There might be much fewer people unemployed.

The Deputy is harking back to a previous amendment. I have already ruled on that matter.

I have very little admiration for what the Minister has attempted in this regard in this House. From a very early age all of us are warned by our parents before we move out into the big world to look before we leap, not to buy a pig in a poke. Here we have a classical example of the parliament of a nation being asked to support the purchase of a pig in a very big poke. Nobody can see what is in the bag. I do not know whether my appeal is getting through to the Minister or whether he will accept this very simple amendment. I cannot see what difficulty it will create for him. His reputation has suffered somewhat during the course of the debate up to now and this might be an opportunity to restore even a very small part of his credibility, at least if he is honest enough to have written into the Bill what the exact position was.

This is a very sad occasion for democracy and for our Parliament. Consultation was to be a theme of the Coalition Government. The Minister remembers that as one of the 14 points they put before the nation. I am afraid that as in the case of many of the other points, there is a great lack of consultation. Maybe it is time the Minister and his friends moved over; maybe they are getting stale.

Maybe the Deputy should get back to the amendment.

I should like to get back to the amendment, but one cannot help letting one's mind drift along those avenues, because power does corrupt. Is this the first sign of corruption?

This is all quite irrelevant to the amendment.

Some would argue it is not the first sign but one of many. I would make a final appeal to the Minister, in the interests of all citizens, to come clean.

I know it is a matter for the agreement of the House, and particularly of the Chair, because I spoke yesterday, but a matter of some importance has come up to which, with the agreement of the House, I would like to make reference.

The Minister has already spoken.

Would it be possible to admit me after Deputy Callanan?

As I have said, the Minister has already spoken on amendment No. 4. I would not be entitled to call him again unless he has some brief comment or explanation to make, with the permission of the House.

Yes, we have no objection.

I will call the Minister then after Deputy Callanan has spoken.

I did not intend to speak on this Bill but the reason I do so is the importance of this amendment. It has been stated clearly that the facts of this agreement were not put before the House. What is worrying me and should worry Deputies on both sides of the House is the total irrelevance of this Parliament. We are debating something here we have not seen, maybe for good reasons but the reasons put forward have not been sufficient, to my mind. As Deputy Colley said yesterday, whatever is in the agreement, whether it is good or bad, we cannot accept responsibility for it because we do not know its content.

The Deputies in this Parliament are supposed to be the watchdogs for the people of Ireland. The watching we do cannot be effective when we have no teeth. I did not think such a Bill could be put through this House, but I have become highly educated in this respect during my few years here. It is extraordinary, as I gathered from the discussion on the Bill, that various people know what is in the agreement but this House, which is supposed to be the Parliament of the people, does not know what is in it. Are we not supposed to be sufficiently intelligent or sufficiently trustworthy to be told what is in this agreement?

Another amendment was passed yesterday in regard to which it was difficult to understand the difference between secret and confidential. If I give something to a person confidentially I mean him to keep it secret. The Attorney General stated that there were certain clauses in the agreement that should be kept confidential, but there is no getting away from the fact that confidential is secret. The purpose of the amendment before the House is to write into the Bill a provision to the effect that the Deputies who discussed the Bill had not the facts before them, and I think, in fairness, the Minister will have to accept that. If the Deputies on that side of the House happened to be over here, they would be looking for the very same information and would be lacking in their duty if they did not do so.

I am not in a position to discuss the merits or demerits of the agreement. However, I have been present for a great deal of this debate since it started, and I have to admire the amount of research that was done by Deputy O'Malley and Deputy Colley. They have done a great service to the State. It is unfortunate that the Minister cannot see his way, in the interests of his own party, to give the information sought. When he cannot give it it is only right to provide that the Bill passed this House without all the information that was sought being placed before the House.

I am allowing the Minister to interject only. I cannot allow a second speech. That privilege applies only to the mover of the amendment.

I appreciate that and I want to thank you for your agreement and, indeed, I thank the Opposition. I trust it will be clear why I have asked to be permitted to intervene now. Yesterday evening Deputy Colley read into the record of the House a copy of a telex message which he said had been sent to Deputy O'Malley and which Deputy Colley said "draws attention to the reality of the situation". Deputy Colley understood this message—I presume, the original of it—had been sent to one of the people mentioned in amendment No. 3 which was then under discussion. Having read out the message he said: "The signature and address are given on it which I do not propose to give here unless it is necessary."

I feel Deputy Colley should give this additional information. The reasons for my request are fairly obvious. In the message which Deputy Colley read out the Northern Bank Finance Corporation is mentioned, I think, four times. There are also references to alleged rights of this bank and to clauses relating to the bank's loan arrangements. In the absence of definite information it is, I think, a fair assumption that this was a communication from the Northern Bank Finance Corporation or one of its associates to one of the Bula people. I am not an expert on these matters and I have had not sufficient time in which to secure advice. The language of the message is rather odd and the message as a whole could have very significant implications for Bula from a business point of view. On the assumption that this communication was from the Northern Bank Finance Corporation or one of its associated companies one would expect that it would have been regarded as highly confidential. As a coincidence I note in one of the advertisements placed in yesterday's newspaper that the Northern Bank properly place a high regard on confidentiality. Their advertisement states: "Your account is private. Everyone in the bank is pledged to secrecy".

If, therefore, the message which has been read onto the record of the House is a confidential document between banker and customer, this is a most serious matter. However serious it might be in such circumstances, it would pale into insignificance as compared with the situation which would arise if this communication were not from the Northern Bank Finance Corporation or one of its associates. If the communication did not come from the Northern Bank Finance Corporation or one of its associates then there can be no authoritative basis for any of the statements made in it and the message has the most serious implications both from the point of view of the private company concerned and, of course, from the point of view of the State's proposed shareholding. For these reasons it is absolutely essential that the authorship and the authenticity of this message should be put beyond any doubt and that the position should be recorded in the records of this House.

Deputy Colley to reply to the debate.

No, Sir. I simply want to reply to what the Minister has said.

The Chair is in slight difficulty here. I allowed the Minister to intervene or interject and I made it clear that second speeches would not be allowed and that it is the privilege of the mover—in this instance, yourself—to reply. I cannot allow a debate in reply.

The Minister requested the permission of the Chair to say something, even though under Standing Orders he did not have the right to speak again. The Chair sought the agreement of this side of the House to allow the Minister to speak. He has now said something which obviously calls for a reply and Deputy Colley is being denied the same courtesy that was extended to the Minister.

Most certainly not. Deputy Colley as the mover of this amendment has the right to reply to the debate and Deputy Colley will have full and ample opportunity to reply to all that has been said in respect of the debate on this amendment, including the remarks of the Minister just now.

Naturally, I am not in a position to comment on what the Minister has said in this regard. I am simply contributing to this debate in order to support amendment No. 4, which I take it we are now dealing with. I fully accept that there is not a great deal I can say in support of this other than what has already been said in support of amendment No. 2. When I was Minister for Industry and Commerce I found myself subject to demands from this side of the House to publish the contents of a report on an investigation of the woollen and worsted industry. My defence at that stage was that it was not in the interests of the woollen and worsted industry to publish the contents of the confidential report that had been requisitioned by the Department. It was a report which made recommendations regarding closures, amalgamations and mergers and I was at the receiving end of a great deal of pressure from the Opposition. There was a great deal of adverse publicity about trying to cover up the recommendations made in that report.

I cannot recollect whether I was the subject of attack from the then Deputy Keating but I am sure I was attacked by the then Deputy O'Leary because he was spokesman for Industry and Commerce. I do know that Deputy Donegan, now Minister for Fisheries, was the Fine Gael spokesman for Industry and Commerce and he gave me quite a deal of abuse. My defence was that it was not in the interests of the woollen and worsted industry to publicise the recommendations. I stood over that and I have never been associated with the demand on the present Minister to publicise the contents of that report, even though it is probably outdated now. There was no Bill, of course, because in those days of "non-open" Fianna Fáil Government we never got around to introducing any Bill in which we did not put our cards on the table.

I have no reason to doubt the word of the Minister when he says that this agreement should not be published in the interests of the firm in which he as Minister for Industry and Commerce is preparing to take a 49 per cent stake. If it is not in the interests of the Minister and of the State to publish this agreement, I cannot see why he will not accept the statement of that fact that is built into our amendment. Through Second Stage and Committee Stage we have fought with the Minister asking him to lay on the record of this House a copy of that agreement. He has consistently told us that it is not in the best interests to make this document public.

The first amendment has been defeated. The Minister may feel that the building in of a statement in regard to a secret agreement might look defensive and that it is not the type of thing he would like to see in legislation. I cannot see anything wrong about a definition section which concerns an agreement which has not been made available to the Oireachtas. The Oireachtas embraces the Dáil, the Seanad and the President. We became very aware of this some time ago when the former President was insulted and when there was one arm of the Oireachtas falling out with another.

The difficulty encountered here is that one could find the Minister asking to intervene again in this debate, as he did at some stage yesterday, when I was in full flight in relation to amendment No. 3 and when I found that the Minister was accepting it. I do not know whether or not he has positively put on the record whether he is or is not accepting this one. He did contribute twice but at no stage did I hear him say he was against it. We know he is in favour of the secret agreement. I cannot understand why the Minister will not allow it to be entered; it occurs throughout the Dáil debates over a period. Of course, the Minister cannot now reply.

This is a situation in which a copy of the agreement has not been made available to the Oireachtas. When this Bill goes to the President for signature, I hope the Minister will condescend to let the President have a copy of the agreement. If there is any man in this country entitled to a copy of that agreement, it must be the President. Perhaps that is why the Minister did not positively refuse by word of mouth, apart from nodding his head, to accept this amendment.

I believe I did refuse; I believe the record will show that.

Perhaps I missed that. The Minister may remind me that it is on the record of the House. Perhaps the Minister is not following all of what we say with rapt attention and I might be guilty of the same.

I should like to know what right the third arm of the Oireachtas has in this regard because it is part and parcel of what is built into our amendment. We know now that the Minister is refusing to accept this amendment. That means that he does not want to have it recorded in the Bill that the agreement has not been made available to the Oireachtas. We can vouch for the fact that the agreement has not been made available to the Members who make up the minority in Dáil Éireann. Listening earlier to Deputy Barry Desmond there were occasions when I felt that, for some reason or other, he may have had access to a copy of that agreement because he spoke authoritatively on it.

No trouble to him.

One must assume that all Bills before introduction to this House by a Minister have been cleared by the Government. Therefore, I assume that the Members of the Government must have been aware of the content of this Bill before its introduction. What we do not know is whether Members of the Government were also allowed to see a copy of the agreement or what was the arrangement within the Cabinet in this regard.

The Minister indicated that he is unwilling to accept this amendment. If he accepted this amendment which includes the words "the agreement which has not been made available to the Oireachtas", could it transpire that it has been made available to so many Members within the Oireachtas that the amendment itself might be out of order because that would be stating a non-factual position? Certainly I am worried that, when this Bill goes to the President for signature, he will be afforded an opportunity of seeing the agreement.

Deputy Molloy yesterday spoke about the day he received this Bill in the first instance—and he was probably expressing the view of a number of Deputies. When he looked through it, first of all, for the explanatory memorandum it was not there. But, perhaps, one could maintain that the Bill is self-explanatory apart from the non-circulation of this agreement. Then he continued to search the envelope thinking it would contain a copy of the agreement but it did not. That was a legitimate search in which any Deputy of this House might engage. While I appreciate the basic reason for the Minister opposing amendment No. 2 and also having a basic objection to having the word "secret" built in because of its ominous sound, I cannot see what justifiable reason he has in refusing to accept an amendment which is simply and solely a basic statement of fact. I merely wonder if statements of fact or truth have now become bad news to the Government so that they cannot even accept them.

First of all, I should like to refer briefly to the Minister's intervention this morning. When I quoted this telex message I did not indicate the person to whom it was addressed. I said it was one of those mentioned in our amendment but I did not say the person to whom it was addressed. The Minister quoted me correctly in regard to what I said about the person who sent it, that is, that while I had the name and address here, I did not propose to give them unless such became necessary. It has not become necessary as a result of the Minister's intervention. But I should like to make it absolutely clear that this telex message I read out did not come from the bank or anybody acting or purporting to act on behalf of the bank. Indeed, somewhat closer attention to what it says would make that evident on its face. But I can say it came from somebody who clearly feels disenchanted with the bank and what it did in relation to his business, who was suggesting, I think, to one of the former directors, I think that is the correct description, of Bula—I cannot quite remember with the changes whether or not he is still a director but anyway to a man who was a director and who may still be a director of Bula—that he should watch out, that he seemed to be under a misapprehension as to what was the position as between Bula and the Northern Bank Finance Corporation.

Perhaps, having given that background of the sender, I might be permitted to read it again, it being clear what was the context. It contains one sentence which anybody giving it some thought would realise could not have come from the bank.

It says:

You are reported as saying that pending the loan repayment the bank acts in accordance with the wishes of the beneficial owners. But when the loan is repaid, the bank is obliged to retransfer the shares to Bula Holdings or its nominees. Did you clear the statement with Northern Bank Finance Corporation. Your statement is one hundred per cent wrong if it purports to represent Northern Bank Finance Corporation's position. Northern Bank Finance Corporation claim the right to dismiss the board and sell off the assets without reference to the beneficial owner or otherwise. We refer you to the J.G. Mooney case.

That sentence makes it quite clear that it could not have come from the bank. It goes on:

We refer you to the call clause in Northern Bank Finance Corporation loans.

I have no knowledge of the terms of the loans, or whether there is a call clause, or what it is. Quite clearly, this person is aggrieved with the bank and, in effect, is warning Bula as to what they may have got themselves into, 80 per cent of the shares having been transferred to the Northern Bank Finance Corporation.

I am glad to have the opportunity, if there was doubt about it, of making it perfectly clear that communication did not come from the bank or anybody on its behalf, and did not purport to come from the bank or anybody on its behalf.

Now he tells us.

Is the Minister seriously suggesting he was under the impression that this came from the bank? Could he visualise any bank saying in a communication: "We refer you to the J.G. Mooney case"? Could he visualise that in all seriousness? I find it incredible that the Minister would even suggest that could have happened coming from a bank.

On the other hand, I do not recall in the Minister's intervention that he said: "Of course, if the statement comes from somebody other than a bank, it is wrong." I do not remember him saying that and, therefore, the suggestions in it are wrong so far as Bula are concerned and this could not happen to Bula. If the Minister wants to say that, I am quite prepared to yield to him again to give him the opportunity to say it. I do not want any misunderstanding about this position. Does the Minister wish to say that? He does not. Right. The message is clear enough. The message is quite clear now. I do not know what the purpose of the Minister's intervention was. I can understand he may have felt there was some danger of a misinterpretation that this had come from the bank. I can understand he would want to clear that up.

He went a little further in what he said about it if it did not come from the bank. The fact that he has failed to accept the invitation I have just given him shows quite clearly that the Minister's concern may have been quite different from the one he expressed here this morning, and it is understandable. I do not know the terms on which the money was borrowed, apparently, by Bula Holdings from the Northern Bank Finance Corporation. I say "apparently" because we were not given the details of this. All we know is that the shares have been transferred and, as far as the shares register is concerned, without conditions, and the Northern Bank Finance Corporation, a subsidiary of the Midland Bank, are now registered as the beneficial owner of 80 per cent of the shares of Bula Limited. There is so much more about this transaction that we do not know, that I suppose we should be grateful we know even that much.

Since the telex message made certain suggestions about what the terms of such a transaction would be, I assume if the Minister had wanted to say those terms did not apply in this case, he would have said so. He got the opportunity to do that and did not. So far as I am concerned the position is clear enough. I hope it is clear to others. If it is not, I will be glad to clarify it in any way I can.

If I may now return to the amendment, I will not keep the House unduly long on it. The position on that is also fairly clear. An agreement has been entered into. We do not know all its terms but we know some of them. The terms we know of indicate that the agreement is seriously defective in a number of ways, that it was incompetently negotiated, and that nobody with a modicum of expertise in the field of commerce would have entered into such an agreement, or allowed himself to be manoeuvred into such an agreement.

We have pointed out some of the defects. I do not want to go back over them all again here this morning. Given that these major defects exist, and that there are people who find it incredible that such conditions were agreed to by the Minister, and that what we know of the agreement is as defective as it is, why should there be an objection to the factual statement being inserted in this Bill that the agreement was not produced to the Oireachtas? In the course of this debate the Minister has said quite a few things, but he has not said anything which would indicate a rational reason for refusing to record that factual position. It is a factual statement—he does not deny that—that the agreement has not been produced.

I indicated before the reasons why I think it is wrong that it should not have been produced but, given that it was not produced, I can think of no good reason why that should not be recorded. In proposing the amendment I have indicated quite a number of good reasons why it should be recorded. Nevertheless, in consonance with the general attitude the Minister has taken throughout this debate, an attitude which at best could be described as non possumus and which could be described more harshly on many occasions, he is saying “no” to this amendment. I do not propose to involve the House in unnecessary discussions if that is the position.

All I can do is repeat what I said when I was proposing the amendment. We on this side of the House want to have no part in the agreement, the agreement we have not seen, the agreement of which we know something. We want to have no hand, act or part in it. We want in no way to be represented as approving of that agreement. We have done what we could to place on record that we did not approve of the agreement, and that we did not see it. This is a further effort to exonerate the Houses of the Oireachtas from any responsibility for that agreement. Understandably the Minister wants to share the responsibility and, for that reason, he will not accept the amendment. In due course, I am sure, the whole story will emerge and people can judge it for themselves.

Amendment put.
The Dáil divided: Tá, 52; Níl, 61.

  • Allen, Lorcan.
  • Andrews, David.
  • Brady, Philip A.
  • Briscoe, Ben.
  • Brosnan, Seán.
  • Browne, Seán.
  • Brugha, Ruairí.
  • Burke, Raphael P.
  • Callanan, John.
  • Calleary, Seán.
  • Carter, Frank.
  • Colley, George.
  • Collins, Gerard.
  • Connolly, Gerard.
  • Cronin, Jerry.
  • Crowley, Flor.
  • Daly, Brendan.
  • Davern, Noel.
  • de Valera, Vivion.
  • Fahey, Jackie.
  • Farrell, Joseph.
  • Faulkner, Pádraig.
  • Fitzgerald, Gene.
  • Fitzpatrick, Tom (Dublin Central).
  • French, Seán.
  • Gallagher, Denis.
  • Geoghegan-Quinn, Máire.
  • Gibbons, Hugh.
  • Gogan, Richard P.
  • Healy, Augustine A.
  • Hussey, Thomas.
  • Kenneally, William.
  • Lalor, Patrick J.
  • Leonard, James.
  • Loughnane, William.
  • Lynch, Jack.
  • McEllistrim, Thomas.
  • MacSharry, Ray.
  • Meaney, Tom.
  • Molloy, Robert.
  • Moore, Seán.
  • Murphy, Ciarán.
  • Nolan, Thomas.
  • Noonan, Michael.
  • O'Connor, Timothy.
  • O'Kennedy, Michael.
  • Power, Patrick.
  • Timmons, Eugene.
  • Tunney, Jim.
  • Walsh, Seán.
  • Wilson, John P.
  • Wyse, Pearse.

Níl

  • Barry, Peter.
  • Barry, Richard.
  • Begley, Michael.
  • Belton, Luke.
  • Belton, Paddy.
  • Bermingham, Joseph.
  • Bruton, John.
  • Burke, Liam.
  • Byrne, Hugh.
  • Cluskey, Frank.
  • Collins, Edward.
  • Conlan, John F.
  • Coogan, Fintan.
  • Cooney, Patrick M.
  • Corish, Brendan.
  • Cosgrave, Liam.
  • Costello, Declan.
  • Coughlan, Stephen.
  • Creed, Donal.
  • Cruise-O'Brien, Conor.
  • Desmond, Barry.
  • Desmond, Eileen.
  • Dockrell, Henry P.
  • Dockrell, Maurice.
  • Donegan, Patrick S.
  • Donnellan, John.
  • Dunne, Thomas.
  • Enright, Thomas.
  • Esmonde, John G.
  • Finn, Martin.
  • Fitzpatrick, Tom (Cavan).
  • Flanagan, Oliver J.
  • Governey, Desmond.
  • Griffin, Brendan.
  • Halligan, Brendan.
  • Hegarty, Patrick.
  • Hogan O'Higgins, Brigid.
  • Jones, Denis F.
  • Keating, Justin.
  • Kelly, John.
  • Kenny, Enda.
  • Kyne, Thomas A.
  • L'Estrange, Gerald.
  • Lynch, Gerard.
  • McLaughlin, Joseph.
  • Malone, Patrick.
  • Murphy, Michael P.
  • O'Brien, Fergus.
  • O'Donnell, Tom.
  • O'Leary, Michael.
  • O'Sullivan, John L.
  • Pattison, Séamus.
  • Reynolds, Patrick J.
  • Ryan, John J.
  • Ryan, Richie.
  • Staunton, Myles.
  • Taylor, Frank.
  • Thornley, David.
  • Timmins, Godfrey.
  • Toal, Brendan.
  • Tully, James.
Tellers: Tá, Deputies Lalor and Browne; Níl, Deputies Kelly and B. Desmond.
Amendment declared lost.

Amendment No. 5 has been ruled out of order.

I move amendment No. 6:

In page 2, line 21, after "£9,540,000." to add "The said shares so acquired shall rank pari passu with all other shares of the Company for all purposes”.

The object of this amendment is to ensure that the shares acquired by the Minister will rank equally for all purposes with all other shares in the company. In the normal way one might think there was no necessity for this kind of precautionary provision but in the course of Committee Stage debate, Deputy O'Malley suggested, and the Minister did not deny it, that the secret agreement to which reference had been made on numerous occasions contained a provision to the effect that the Roche/Wymes/Wood block of shares, which is expected to amount to 41 per cent could, in certain circumstances, out-vote the remaining 59 per cent of the shares. I hope that is not so but if it is the position then the Minister will not be able to accept this amendment. If it is not the position I cannot see any reason why he could not accept it.

The position is that Patrick Wright referred to in the Bill, and apparently in the agreement, is now deceased. His estate will hold 10 per cent of the shares. Some of those shares may come on the market and, subject to what is going to happen on a later amendment the Minister could well acquire those shares. "Coming on the market" is a slight misnomer when one is speaking of a private company but we mean coming on the market within the terms laid down in the memorandum and articles of association of the company. It is conceivable that the Minister might acquire those shares and he could end up with 59 per cent of the shares. Nevertheless the suggestion that has been made in this House, and has not been denied by the Minister, is that even if he had 59 per cent of the shares, the 41 per cent block could in certain circumstances outvote them.

The object of this amendment is to ensure that this situation will not happen and that the shares being acquired by the Minister will, for all purposes, rank equally with all other shares. That is not an unreasonable proviso for the Dáil to insert. If there is such a provision in the agreement, that is monstrous because not alone is the State a minority shareholder but it has built itself into a permanent minority. As I said, even if the State acquires the Wright holding of shares, it will still be in a minority position when it comes to voting. To be paying £9.5 million for that kind of situation would hardly be a satisfactory outcome.

Either the agreement has this provision in it, which is totally unacceptable, or it has not. If it has not, the Minister should have no difficulty in agreeing with the proposition that the shares to be acquired by the State should for all purposes rank equally with all other shares in the company and we need not have any further difficulty with this matter. I trust that the latter is the position and that the Minister will be able to accept the amendment.

I want to go back to an earlier stage of the debate because notwithstanding something that was said with very great clarity, whether by accident or by design, the Opposition do not seem to understand it. I am not going to quote my words where I convey the same sense but from the words of greater authority than mine in legal matters, the words of the Attorney General, who can put these matters into very clear, explicit and, from the legal point of view, very expert language. I want to quote from the Official Report for 16th February 1977, at columns 1622-1623:

The Bill, when enacted, will not in any way make the agreement referred to in section 1 law. It is not correct to suggest the Bill proposes to make the agreement the law of the land, or that the Bill ratifies the agreement . . .

It is by no means unusual for Ministers to enter into contractual arrangements with outside parties. When they do so, the legal rights and obligations of the parties arise from the agreements and not from any statutory source . . . Any legal rights and obligations of the parties will continue to arise from the agreement and not from the statute.

A great deal that has been said by the Opposition about being asked to make the agreement the law of the land is irrelevant and does not arise. That was said very clearly by the Attorney General on 16th February and has been and still is the position.

I hope the Minister will try to relate his remarks to the amendment because the relationship has not been at all clear up to now.

This amendment relates to a section which authorises the acquisition of shares in Bula Limited, and the effect of the amendment would be to provide by law for the rights which are to be attached to the shares acquired by the Minister. It is not appropriate that the rights of the Minister should be regulated in the manner proposed. The rights of the Minister as a shareholder have been safeguarded adequately in the agreement and it would not be appropriate for me to put into law the rights I have as a shareholder. In fact we are not making the agreement part of the law.

From our side, that position has been completely clear and had it been taken note of it would, of course, have indicated to Members on the other side, if they had wanted to know it, the irrelevance of a great deal of their observations and their amendments. It is understandable, and by no means exceptional, that people who control the operations of a company should desire to ensure that the admission of a substantial minority should not result in their being deprived of the company's control. Operational control is not in this case an objective of participation by the State. Subject to safeguards which I am satisfied are reasonable and adequate, it is proper that such control should continue to be exercised by the existing private interests.

On the other hand, the State has secured a considerable number of preferential rights some of which are designed to ensure that the State's right cannot be prejudiced in a fundamental way. Some of them have the objective of securing rights and powers of a kind which would be appropriate to a lease in respect of State minerals. I am satisfied that the State's overall interests have been safeguarded and that in so far as special rights are concerned, the balance lies in favour of the State. Therefore I am not prepared to accept an amendment which purports to make provision by law in regard to the rights which have been acquired under the agreement.

The Minister has told us more now than he told us at any other stage. Would he be prepared to tell us whether he would still not have control even with a 59 per cent holding?

It is remarkable how the Minister can go so far and no further. He has relied on contributions made by the Attorney General and has referred to statements made on this side. My understanding of his remarks this morning is that we on this side have been right that the Minister cannot get control of the shares except by some chance which the Minister has failed to put on record. It is becoming more and more difficult to get the Minister to commit himself in this respect. When the Minister refuses to reply to a question there is the logical conclusion that he cannot reply because of the situation he is in.

I suggest the Minister has made a slip and that we will never have a majority situation in this company, much as the Minister may be jockeying for that situation. He apparently has been advised, rightly or wrongly, not to accept any of our recommendations. When he sat down with those gentlemen it must not have been a pleasant experience and I have a certain amount of sympathy for him in that respect. I have not the same admiration for that group that a number of people have. In other circumstances this Bill would not be necessary because this property would be in the hands of the State, without any interference. We are dealing with a company who moved very suddenly at a time when the Minister for Industry and Commerce was on the point of making an order. Therefore, I have no compunction in urging the Minister to take every opportunity on behalf of the State to get the people's rights back. That can be done through the State being able to lay its hands on the 10 per cent holding of the late Patrick Wright.

The difficulty is that we cannot get the Minister to clear up that point for us and the Attorney General is not here this morning to do so.

We have an agreement and built into that agreement are a lot of secrets and the Minister has said that it is not in the national interest and in the interest of the firm in which we are 49 per cent involved to divulge the contents of that agreement. Amendment No. 6 is one way of trying to extract from the Minister information as to whether we are going to be in a state of perpetual minority interest or whether there is a prospect of getting State control. The last thing I would expect the Minister to be fighting for would be a minority shareholding. The first thing I would expect the Minister to look for would be a controlling interest. The Minister always goes down when he gets the opportunity of telling us "I am all for control. One of the ways we can get control is such and such." The Minister is quite good at getting messages across of great things happening when nothing at all is happening. I am sure he has plans and ideas in this regard and if he would say "I have plans but it does not suit me to disclose them, but those plans include control of this outfit in the national interest", I would approve of that.

We have to be careful in discussing this amendment to see what it is about. It mentions the words pari passu. In other words, the Opposition are saying that the shares being purchased by the Minister in the company should be shares with equal rights to those enjoyed by the other shareholders; that they should not be denigrated or of a lesser class than the shares held by the other members of the company.

This debate seems to be confused in the mind of Deputy Lalor. He seemed to be talking about the numbers of shares rather than the rights. The section is quite clear. It says:

The Minister may acquire not less than 49 per cent of the issued shares of the company in accordance with the Agreement . . .

Reference has been made in this debate to certain utterances by Deputy O'Malley and I understand he raised this matter of whether the shares had equal rights or not with those retained by the present members of Bula. It surprised me that Deputy O'Malley when raising this point did not refer to the articles and memorandum of the company. He must have read the articles and memorandum because he referred to a specific clause in the articles on another matter, that of the guarantee. If the shares in Bula were of different classes—say one share had a preferential right over another—I would have thought that Deputy O'Malley as a lawyer, having read the articles and memorandum of the company, would have referred to any rights that might be allocated to any particular shares. He did not do so. My impression, having listened to this debate as a lawyer listening to lawyers and having interjected now and again, is that Deputy O'Malley was putting up windmills and tilting at them in Don Quixote fashion. It is open to no other interpretation to me as a lawyer and I do not think it can be open to any other interpretation to any accountant or businessman listening to the debate. If there was any foundation for the imaginary fears propounded by the Opposition, which I assume are the grounds for the amendment, one would imagine that a certain elemental factual foundation would have been laid for this proposed amendment. Instead of that we have some imaginary fears which are extraordinary in so far as they were raised by a lawyer who has read the constitution of the company. We have no reference to any fact in the articles or memorandum. I have not read the articles and memorandum of this company. I do not know what they contain. I could assume, but I have not done so. I would have thought that when a lawyer gets up in this House, particularly as a front bench spokesman, he would have some factual foundation for putting forward an amendment of this sort. This is quite apart from the point rightly made by the Attorney General.

We are dealing with a statute here, not with a contract but I would like to underline that the Minister has made a very concise statement in reference to this contract and he has used some very interesting words. One must look at this contract as one that is being entered into on financial, legal and business advice and using political and social judgment. It is quite evident from what has been said today that there are other benefits accruing to the State that are not particularly allied to the rights under the shares of ordinary shareholders. Those would be the circumstances having regard to the fact that a 49 per cent shareholding is being purchased in this company. It would be natural that these precautions would be taken. They are obviously being taken and on the very top level advice that this country possesses.

We should not be trying to set ourselves up as company lawyers, company physicians, mining speculators or whatever. We have done our duty in expressing our views in this House concerning this Bill. The main difficulty from the point of view of the Opposition is that it is something completely new in political thinking in this country. It is a type of thinking and conduct that will be followed by many other countries. We have now to approach things in the light of that. We cannot just separate this business enterprise as between private enterprise and State enterprise. Therefore, when the State participates in a private concern it must accept the rules and take the precautions normally taken by a private individual, by a bank, a finance house, a private company or a private investor. That has been amply shown to be the case here. However, I want to underline again the question as to where are the facts in the memorandum as a ground for this amendment that have not been referred to by Deputy O'Malley? This is something I cannot understand having listened to a lawyer, an experienced politician, an experienced front bencher and an ex-Minister.

It is very nice to have Deputy Esmonde's assurance that there is no basis for the fears expressed, the fears exemplified in the terms of the amendment. As I say, it is very nice to have this assurance but not very useful because one assumes that Deputy Esmonde, like ourselves, has not seen the agreement. I do not know whether it has escaped Deputy Esmonde's notice, but the parties to the agreement as defined in section 1 are also the shareholders of Bula Limited presumably as at the time of the making of the agreement. The agreement can, therefore, very easily contain provisions such as we have outlined in regard to the rights of shareholders. If it should become necessary, in order to implement such an agreement, to change the value of different classes of shares, and there is an agreement between the shareholders to do so, there will be no problem, as the Deputy well knows.

The important thing is what is the agreement in this regard. The Minister has steadfastly refused to tell us, although he did tell us today more than he told us on any other stage in that regard. He said operational control is not an objective of the State's participation. The message is very clear. He does not propose to get and has not got control. Fair enough. But the crucial question is the one I put to him, a question we put to him many times before, a question he has failed to answer many times before and which he failed to answer again this morning. The question is: if he acquires a majority of the shares, will he then have control? The suggestion made is that he has already agreed that in such circumstances he will not have control. This is a very relevant matter. He has either agreed to that or he has not. If he has not agreed it is absolutely a time-wasting exercise for him not to say so. If he has agreed why should he not say so? What damage would that do to anybody except the Minister? It could not do any damage to the company or to the other shareholders. But it could of course be extremely damaging to the Minister's reputation, such as it is, for commercial acumen. But the Minister has made no such admission.

This amendment is designed to ensure that the agreement does not, in fact, contain the type of provision I have outlined to enable any such setup to occur in future. It is significant the Minister refuses to accept that. It is also significant that, in dealing with the amendment, he quoted the Attorney General speaking on another matter. He quoted him as saying the very obvious thing that the Bill does not make the agreement law. In one sense that is perfectly true. But the Minister went on to say it was not proper for him to lay down conditions of this kind. I am not sure if "lay down conditions of this kind" were the words he used, but I want to tell him now that it is proper for this Dáil to do so. If the Minister has in this secret agreement agreed to provisions which would take away from him the right to exercise control of this company, even if he has a majority shareholding, then he should tell the House that and justify it and defend it, if he can. If, on the other hand, he has not done so and he thinks it is not proper for him to provide for this in the Bill, then it is proper for Dáil Éireann to do so to ensure this situation will not be allowed to arise in future.

The fact of the matter is, of course, that the whole course of the debate makes it virtually certain that the Minister has agreed to give away his right to control, even if he has a majority of the shares, and no amount of claptrap about commercial interests can justify concealing the fact. Either it is done or it is not done. If it is not done it is obviously in the best interests of the Minister and of the House that that should be made perfectly clear. But, if the Minister has so agreed, what possible commercial damage could be done to the company or to the other shareholders by an acknowledgement of that fact?

The most significant aspect of the Minister's attitude in this regard is his failure to accept this amendment. His alleged justification for not doing so is a very thin one; it would not be proper to put it into this. It could be very appropriate if such a proposition came up in the future and the Minister's hands were tied and he could not agree to it as a shareholder. It could be a very useful weapon to have. I am afraid the real truth of the matter is becoming clearer and clearer. I want to remind the Minister that, however much he tries to cover up the failures which have been piling up, failure upon failure, in this regard as more information comes to light, the whole story will come sooner or later and really he would do better to tell us the whole story now and in the process let us try to salvage something from the wreck by accepting amendments of this kind. The Minister chooses not to do so. We have done all we can. The Members who support him will have to take the responsibility for what they are doing.
The Dáil divided: Tá, 53; Níl, 61.

  • Allen, Lorcan.
  • Andrews, David.
  • Brady, Philip A.
  • Briscoe, Ben.
  • Brosnan, Seán.
  • Browne, Seán.
  • Brugha, Ruairí.
  • Burke, Raphael P.
  • Callanan, John.
  • Calleary, Seán.
  • Carter, Frank.
  • Colley, George.
  • Collins, Gerard.
  • Connolly, Gerard.
  • Crinion, Brendan.
  • Cronin, Jerry.
  • Crowley, Flor.
  • Daly, Brendan.
  • Davern, Noel.
  • de Valera, Vivion.
  • Fahey, Jackie.
  • Farrell, Joseph.
  • Faulkner, Pádraig.
  • Fitzgerald, Gene.
  • Fitzpatrick Tom (Dublin Central).
  • French, Seán.
  • Gallagher, Denis.
  • Geoghegan-Quinn, Máire.
  • Gibbons, Hugh.
  • Gogan, Richard P.
  • Healy, Augustine A.
  • Hussey, Thomas.
  • Kenneally, William.
  • Lalor, Patrick J.
  • Leonard, James.
  • Loughnane, William.
  • Lynch, Jack.
  • McEllistrim, Thomas.
  • MacSharry, Ray.
  • Meaney, Tom.
  • Molloy, Robert.
  • Moore, Seán.
  • Murphy, Ciarán.
  • Nolan, Thomas.
  • Noonan, Michael.
  • O'Connor, Timothy.
  • O'Kennedy, Michael.
  • Power, Patrick.
  • Timmons, Eugene.
  • Tunney, Jim.
  • Walsh, Seán.
  • Wilson, John P.
  • Wyse, Pearse.

Níl

  • Barry, Peter.
  • Barry, Richard.
  • Begley, Michael.
  • Belton, Luke.
  • Belton, Paddy.
  • Bermingham, Joseph.
  • Bruton, John.
  • Burke, Liam.
  • Byrne, Hugh.
  • Cluskey, Frank.
  • Collins, Edward.
  • Conlan, John F.
  • Coogan, Fintan.
  • Cooney, Patrick M.
  • Corish, Brendan.
  • Cosgrave, Liam.
  • Costello, Declan.
  • Griffin, Brendan.
  • Halligan, Brendan.
  • Hegarty, Patrick.
  • Hogan O'Higgins, Brigid.
  • Jones, Denis F.
  • Keating, Justin.
  • Kelly, John.
  • Kenny, Enda.
  • Kyne, Thomas A.
  • L'Estrange, Gerald.
  • Lynch, Gerard.
  • McLaughlin, Joseph.
  • Malone, Patrick.
  • Murphy, Michael P.
  • Coughlan, Stephen.
  • Creed, Donal.
  • Cruise-O'Brien, Conor.
  • Desmond, Barry.
  • Desmond, Eileen.
  • Dockrell, Henry P.
  • Dockrell, Maurice.
  • Donegan, Patrick S.
  • Donnellan, John.
  • Dunne, Thomas.
  • Enright, Thomas.
  • Esmonde, John G.
  • Finn, Martin.
  • Fitzpatrick, Tom (Cavan).
  • Flanagan, Oliver J.
  • Governey, Desmond.
  • O'Brien, Fergus.
  • O'Donnell, Tom.
  • O'Leary, Michael.
  • O'Sullivan, John L.
  • Pattison, Séamus.
  • Reynolds, Patrick J.
  • Ryan, John J.
  • Ryan, Richie.
  • Staunton, Myles.
  • Taylor, Frank.
  • Thornley, David.
  • Timmins, Godfrey.
  • Toal, Brendan.
  • Tully, James.
Tellers: Tá, Deputies Lalor and Browne; Níl, Deputies Kelly and B. Desmond.
Amendment declared lost.
Barr
Roinn