Deputy O'Malley applied for and was given permission to raise on the Adjournment of the House the subject matter of a Private Notice Question which he sought to put to the Minister for Energy today.
Adjournment Debate. - Closure of ESB Generating Stations.
Thank you, a Cheann Comhairle. I want to raise the question of the apparent announcement, in the form in which the ESB announce things — which is to leak them to one or more newspapers and in this case it seems to be one — of their latest proposals for the closure of generating stations throughout the country. I am not aware that any denial has appeared of the report on the front page of today's Irish Independent in relation to what they propose. This is, therefore, the second instalment of what they started last October and which was debated here at that time in a prolonged Private Members' debate, which went on for two weeks as I recall it, and where there was unanimous criticism from all sides of the House of the ESB's proposals at the time.
Through the then Minister for Energy, Deputy Bruton, the Government undertook to look carefully at the ESB's proposals before they were implemented. The Minister moved an amendment to the motion which I had put down. It is worth recalling the wording of the amendment because it was subsequently passed on a division. The amendment read:
To delete all words after "Dáil Éireann" and insert:
"endorses the action of the Government in setting up the inquiry to investigate systematically the reasons for the high cost of electricity, notes that the ESB has submitted to the Government a five-year Strategic Plan and calls on the Government to have due regard to the social, regional and strategic implications of the use of indigenous fuel in national energy policy when considering this plan."
That amendment, which was passed and therefore adopted by the House, has two important points. First, the plan concerned was then submitted to the Government and secondly, the Government would consider it, with the clear implication that none of it would be implemented until the Government gave their approval.
We have heard nothing from the Government. The present Minister for Energy was appointed almost ten weeks ago and the first time he spoke on energy was yesterday afternoon when he announced the third oil offshore licensing round. He has been talking about many other things which have been on his mind, but that was the first time in the ten weeks in which he has held that office that the public heard anything from him on any energy related topic. We have heard nothing from him on this topic. It has been given out in their usual fashion by the ESB in some indirect form to the newspapers and, of course, this House as always is ignored in a matter such as this.
We have to assume — because we know it from the terms of the motion passed at the end of October — that the Government have considered this plan, have caused amendments to be made to it and now approve of it in its modified form. The attention of the House and the country should be called to that fact. It seems that the Government have approved of what is reported today as the closure in total of five power stations, four of them being turf burning, the partial moth-balling of the other oil-fired stations, the keeping on of two small stations at Gweedore and Cahirciveen, and maintaining on a reduced basis stations at Ferbane and Rhode in County Offaly and Bellacorick in County Mayo provided — and this is a major proviso — that Bord na Móna cut their peat prices down from the energy related level at which they are now gearing them.
It would seem, therefore, that in round terms about two-thirds of the original programme put forward by the ESB is now being implemented. I do not think anyone thought very seriously at the time the ESB put forward that programme and leaked it out — because of course it was not published, as is their usual form; they leaked it in order to try to create various pressures — that they would be able to implement it all. Equally I do not think anyone seriously thought they would be able to implement two-thirds of it which apparently is what the Government have now allowed them to do. If the Government have not allowed them, I am asking why the Minister for Energy has not denied it or made any statement in regard to it.
Two-thirds of the original programme, which was politically devised in accordance with the usual method operated by the ESB in these matters, is, apparently, to my surprise and shock, and I am sure to that of many people throughout the country, to be implemented on this basis. It spells the end virtually of peat burning as a significant means of electricity generation here. The only two stations which are being kept on, according to this report, without any proviso or condition, are the two very small stations at Gweedore and Cahirciveen, the capacity of which is five megawatts each, which is only a minute part of less than 1 per cent of the ESB's generating capacity. It is very serious indeed when one of our most important indigenous energy resources is, to all intents and purposes, being abandoned as a means of electricity generation. It should not come out in this way by means of leaks to newspapers. It should be announced by the Minister for Energy as Government policy, and not sneaked out in this way in the hope that people will not notice, or that the Government will not be associated with it.
The estimate here is that the number of jobs which will be lost as a result of this will be somewhere between 600 and 1,000. That is certainly not an over-estimate. Of course, that is jobs lost in the ESB alone. What are not taken into account are the substantial numbers of jobs which will be lost in Bord na Móna which will certainly not be fewer than the 1,000 talked about here, and where there can be no question of redeployment to other bogs or other stations.
It is not unfair to say that as a result of the decision of the Government, as it now clearly is, effectively to do away with peat as a source of fuel for electricity generation, in all, directly and indirectly, about 3,000 jobs will be lost, most of them in the midlands and some in the west as a result. This decision by the Government — although they have not announced it; I can only assume in the light of the previous debate that they have decided on it; they have not denied it — is taken only a few days after it was announced, again in some indirect way by the ESB, that they have under consideration a motion for their next board meeting at the end of this month to close all their retail premises at a cost of approximately 1,000 jobs. Those 1,000 must be added to the others involved. This is part of a further on-going strategic plan by these great men at the head of the ESB who are particularly good at putting together packages which will create pressures in certain areas which will cause things in other areas to happen.
This is coming two weeks after the announcement — not the announcement, sorry, never use "announcement" when talking about the ESB — after the leakage of the redundancy terms in the ESB. The redundancy terms are geared, at the cost of the electricity consumer, to appeal to a very large number of ESB employees throughout the country, particularly in the midlands and the west where men with reasonably long service will be offered substantial sums of money, which, understandably, will be accepted particularly by men in their fifties and upwards. This will lead to the closure of several stations. The ESB will then be able to say that half or three-quarters of the work force in certain places have accepted these redundancy terms.
Most of the debate over the last two or three weeks since those terms were leaked, have related, at the instance of the ESB, to the Ringsend power station. They deliberately chose that station because, from the union point of view, it was the hardest to defend but what the ESB were getting at were the turf burning stations in the midlands which they never wanted — but which they were very glad of four or five years ago — and which they resented because they were forced on them by a previous Government, and they are very anxious to close them down. They will use this roundabout method of offering terms to employees which they know are not likely to be refused. For many employees the terms will exceed £30,000 in some cases plus a pension and social welfare rights. The cost of these will be considerable.
In the meantime the Government as always keep their heads down, say nothing and if a couple of thousand people in the ESB opt to become redundant, the Government can say they did not fire them, the ESB did not fire them, they voluntarily left. In the meantime the consumers, who are already paying the highest price for electricity in Europe, will pay an even higher price to fund this. The ESB, again at tremendous expense to their consumers, will have achieved their objective in terms of personnel management.
It is worth recalling that over the past eight years when negotiations on pay rates or conditions of employment in the public sector were taking place, the headline invariably called on by the negotiators, and understandably so, was the position that obtained in the ESB. They have always led the way in this respect, and they are doing it again now. As a result of the decision which has been endorsed by the Government to close down in whole or in part nearly all the turf stations in the country, with some very minor exceptions, we are going to have very substantial Bord na Móna redundancies. If a man with 25 years' service in the ESB in a midland power station gets a lump sum of £32,000, plus a pension and other benefits, why should a Bord na Móna employee working beside him in the same bog and with the same service, but working for another semi-State body, accept less? Will he accept less? He will not. Do the ESB realise the trend they are starting here and the damage that is being caused? Do the Government realise it? Do they care?
It will be recalled that the ESB were the first to institute the marvellous system of paying employees a substantial sum of money to move from an office at the top of a street to another office 50 yards down. That idea has caught on in a very big way and has percolated from the public into the private sector. The ESB are setting new headlines here. They do not care about these redundancies and obviously the Government do not care because we have heard nothing from them about this. They do not care about the fact of the redundancies or the cost of them. This is the reaction of a Coalition Government, who include 16 supporters of the Labour Party, at a time when there are 215,000 unemployed. This seems incomprehensible, but in terms of the economic decisions of this Government over the last 12 months, very little nowadays should be incomprehensible to anyone.
I object, and the Fianna Fáil Party object, strenuously in particular to the virtual cessation of the generation of electricity from peat. This is a valuable, widely available natural energy resource which we were damned glad to have when we had nothing else, which served us very well and which has been of enormous benefit to many large areas in the midlands and west which would otherwise never have seen economic development of any kind because of the nature of the land there.
This system is now to be cast aside because other more temporarily fashionable things are available. The ESB spend vast sums of money unnecessarily building far bigger than is necessary third and fourth units for a plant to burn Australian, Indian, South African, American and Polish coal in County Clare and at the expense of our own indigenous fuel. The people will not wear this situation. The ESB should not be allowed to get away with it; the Government should face up to their responsibilities and put a stop to it. They were asked to do this by Members on all sides of this House who spoke on the Private Members' debate last October — I think there were 15 speakers in all. Deputies from every side of the House asked the Government to stop this. It is apparent that the Government have approved of this measure and they have declined to make any statement contradicting what has appeared as a very definitive report, the accuracy of which I have been given no reason to doubt and which I deplore. If other European countries had the indigenous energy resources we have they would be damned glad to use them. They would not be setting them aside and abandoning them for all time in favour of other fuels brought from the other side of the world.
I am somewhat surprised that Deputy O'Malley spoke about this matter in such simplistic terms. I am doubly surprised that he has done so in view of the fact that as a former Minister for Industry he should know that the cost of electricity in Ireland is substantially higher than that charged to our competitors in Europe. There are difficulties facing the ESB and I should like to put them before the House. It is well known that the ESB have substantial excess generating capacity, in the region of 20 per cent allowing for a safety margin. When the new plant comes on stream that generating capacity will increase again and will overhang the board's finances in the years ahead. It is also a fact that there has been a drop in the consumption of electricity and that has exacerbated the matter for the ESB. That drop has been noticeable since 1979.
The board of the ESB have a statutory responsibility to break even and provide electricity at reasonable cost to consumers. It is in that context — the drop in consumption, overmanning, further development and all that entails — that the ESB drew up a five-year strategic plan. That plan was drawn up by the board and management of the ESB on their own initiative. That is their statutory responsibility. The board have clear statutory responsibilities with regard to the management of its own affairs. The exception to that is where the board's own responsibilities impinge on Government policy in areas where Ministerial approval is required. I am referring specifically to the area of Bord na Móna, the viability of that concern and their plans for the use of peat. I reject Deputy O'Malley's allegation that the Government are putting an end to peat as a means of generating electricity or that indigenous energy resources for generating electricity are being abandoned. That is a nonsensical allegation by the Deputy and I am sure he is aware of that.
Why are the stations being closed down?
I do not think the Deputy has listened to what I have said.
Is it Fianna Fáil policy to stop Moneypoint?
The Minister of State has a limited time in which to reply to the statement made by Deputy O'Malley and he should be allowed do so without interruption. There should not be any interruptions when the Minister is replying and that is reasonable.
The House should know that the Minister is very sensitive to the position of Bord na Móna. Decisions on the strategic plan were not taken by the former Minister, Deputy Bruton, or the present Minister, Deputy Spring. Deputy Bruton when he was responsible for Energy established a group to examine peat development in its widest aspects by Bord na Móna and private developers. I understand that the ESB have not made any statement on this matter. My understanding is that the leak in the newspapers today arises from ongoing discussions between ESB management and workers and I see that as a normal development, particularly in the ESB. The Government fully realise the importance of peat stations in particular to rural Ireland. They also realise the economic importance of peat production in many areas of rural Ireland.
When full consideration is given by the Tánaiste and Minister for Energy to the proposals for which he has responsibility he will bring his recommendations directly to the Government. There should not be any misunderstanding about that. Deputy O'Malley today attempted to create a crisis in an area where one does not exist. I would have expected more from him.
Is the report in the newspapers all lies? If it is lies I wonder why the Department did not deny it? Why did the ESB not deny it?
If Deputy O'Malley chooses to make irrelevant remarks and not listen to me that is a matter for himself.
Deputy O'Malley is attempting to stop Moneypoint.
We want facts.
Minister Bruton established a prices inquiry with regard to the high cost of electricity, particularly to industrialists. That inquiry has advanced in its work and the Tánaiste and Minister for Energy is at present considering an interim report from it. When that is completed he will bring the matter to the Government. With regard to the price of milled peat from Bord na Móna to the ESB I should like to state that a full analysis of that and all its aspects is a prerequisite. It is fair to say that oil related prices are the broad basis for this price review and policy. It is important that we should balance the continuing viability of Bord na Móna, certainly in relation to its development programme, with the need to ensure that the ESB are getting milled peat at a reasonable price. That is a sensible attitude for the Government to adopt.
There can be no doubt, and there should not be any doubt, that the price of electricity is vital to Irish industry that is suffering a considerable disadvantage because of the over-capacity and overmanning in the ESB. The ESB are statutorily charged to ensure that the price of electricity is reasonable and they must take whatever steps are reasonable in changed circumstances. We have not been a rapidly developing economy since 1979. The ESB must adapt after facing annual growth rates of from 5 to 7 per cent in electricity consumption to a slow emergence from a recession. The board have a statutory duty to be responsible in their attitude to the management of their activities. Deputy O'Malley cannot get away from that. He cannot twist the facts. He came to the House to make political gain out of what can only be seen in the national interest as a constructive attitude by the ESB in regard to their future activity and ensuring that the price of electricity to consumers, particularly industrial consumers, is kept within reasonable terms and, if possible, return to the price level that prevails in the countries of our competitors, particularly in Europe.
So the Minister approves of the closures of these peat stations?
There is an onus on Deputy O'Malley to clarify in the House if it is official Fianna Fáil policy to stop Moneypoint.
The Deputy should cease interrupting.
The Deputy, if he wishes, can tell the CII and industrialists that he does not want any stations closed and point out to them that they will have to bear the higher cost of electricity. If he does that then the problem will rest with Fianna Fáil.
We know where we stand now; they are all going.
In Government we have a responsibility to get the economy back into order and an important part of that will be to ensure that electricity prices to consumers, particularly industrialists, are brought back into line with those of our competitors in Europe.
We know where we stand now.
If Deputy O'Malley does not support that policy it surprises me but on a political basis if he wishes to make cheap capital out of this he can do so.
What about the retail outlets, the shops and the thousands of jobs?
I should like to assure the House that while it is the responsibility of the Tánaiste and Minister for Energy to concern himself with the future of Bord na Móna he will take all steps necessary to ensure the future viability and prosperity of that concern.
What about the thousands of jobs in the shops? The Minister should deal with them.
Deputy O'Malley's contribution was retrograde, politically motivated and did not take account of the needs of industrial consumers to have cheap electricity.
The Minister should be given the title "Minister for closing down factories".
The Dáil adjourned at 5.30 p.m. until 2.30 p.m. on Tuesday, 6 March 1984.