asked the Minister for Fisheries and Forestry how much of the amount provided in the Supplementary Estimate, introduced by him in December 1978 for assistance to Irish Board Mills Limited, Athy, County Kildare, had been spent before the closure of the factory.
Ceisteanna—Questions. Oral Answers. - Athy (Co. Kildare) Factory Closure.
6.
Up to 31 December 1978, a total of £550,000 had been advanced to keep Irish Board Mills Limited in operation. This figure should be reduced in the current year through sales of produce manufactured in the period of subvention.
Is the Minister saying that the sales will be effected by the firm in receivership?
Yes. This should reduce the figure that was advanced by way of grants apart from the numerous loans made by State agencies.
I am concerned with the question of grants. Was the entire grant spent.
As I have said, a total of £550,000 was expended. The total authorised in the House was £680,000 but we saw how things were going and decided that certain events had to happen. That £550,000 will be recovered to some extent as a result of the sales of existing produce on the ground within the firm. These sales are taking place currently.
Is it the position that the receiver who was put in to collect money for two people but not for the Department will have to clear these other creditors first?
No. The returns from the sales he will make will be used by way of a reduction of the £550,000 that we advanced by way of grant.
Therefore, is the debt preferential so far as the Department are concerned?
Yes.
The Department, then, will be preferential and will be considered before the creditors.
The first preferential debt will be in respect of social welfare payments and we stand preferential after that.
Having regard to the fact that the money was voted in December but that the factory had to close less than a month later, on 30 December, what is the reason for the discrepancy? At the time the money was voted we all assumed there were prospects for continuance in the factory. I am sure the Minister assumed that, too, but it is difficult to understand the changed circumstances in such a short time.
To reassure the Deputy and the House, the situation was that the decision to advance the money was made by the Government as far back as September. The money was advanced then in order to help ensure that the factory continued in production and in order to explore every avenue to ensure the firm's continuance as a working unit. That decision was confirmed in December but the money had been granted on 8 September. I trust that puts that aspect in perspective. The further aspect is that we are satisfied and that the IDA, who are responsible for finding a new project for the factory premises, are satisfied that having regard to the structure of the old Irish Board Mills Limited Company and having regard to the manner in which the firm's business was being conducted there are now much better opportunities for a new owner to go in in the present situation. Several inquiries are being considered by the IDA in this connection.
I understand that the Little Report was responsible for the closure of the factory. Is it possible to publish that report or is it a confidential report? Was it recommended in any of those reports that a State body should be set up to cover the three industries? Action was taken by this administration to put managers into the other two big timber industries but Athy seemed to have been left out.
There are problems in all three. There are problems of internal management unrelated to the State and unrelated to any State agencies.
(Cavan-Monaghan): There must be major obstacles if the Minister concedes there are problems.
Am I to understand that the Government made a decision based on financial projections in September, in which the firm appeared to be viable, and the Government subsequently in December had a Supplementary Estimate passed in this House on the basis of an assessment made in September and the arguments used to get that Supplementary Estimate through the House were based on a calculation made in September and not subsequently revised to cover the picture in December? Is that interpretation correct?
The point is that the decision had already been made in September and it had to be authorised in the House subsequently. The decision was made on the basis of trying to rescue a company for which this Government had no responsibility, a company which had very serious internal management problems. We decided on that basis to make an attempt to rescue it. We will get back a large proportion of the money through the sale of stocks on the ground within the premises at the moment and the receiver is in the course of doing that now.
On what date was the money paid which was sought in the House in December by way of a Supplementary Estimate?
I gave that information to Deputy Bermingham, 8 September.
That was the date the Government made the decision. I want to know on what date was it paid to the firm.
It would be within a matter of days of that decision. I have not got the exact date.
It was actually paid in September?
Early September.
There was no authorty from the Dáil for it until December?
We formally ratified the matter.
That is done frequently. Is the Deputy shocked?
I would not be shocked at anything the Taoiseach's Government might do.
The Deputy is putting on an air of innocent shock.
Were anybody's knuckles rapped about this matter?
It was a fully defensible decision.
In what way?
The decision——
It was a decision to pay out £250,000 of the taxpayers' money to a company which, within one month, was "bust" to use an old term. Surely it showed poor foresight on the part of those who analysed the company's prospects to recommend payment of £250,000 of the Irish taxpayers' money to this company?
I want to assure the Deputy that the receiver was in control and the company which had caused all the trouble was gone at the time of the decision in September. Under very legitimate pressure from people like Deputy Bermingham, the trade unions concerned and the workers, we made a last minute effort to save that firm. We did not succeed because of the rank bad management in that firm for years before.
Despite adverse reports——
Question No. 7. We are not having a public inquiry. We have had many questions; more than average.