Deputy Leyden has been given permission to raise on the Adjournment the sudden closure of James (Roscommon) Limited with a consequent loss of jobs. He has 20 minutes.
Adjournment Debate. - Closure of Roscommon Firm.
I should like to accommodate my colleague, Deputy Naughten, who also wishes to participate in this very important debate. As a Government Deputy in the constituency, he also wishes to express his concern regarding this closure. I want to thank you, a Cheann Comhairle, for giving me this opportunity to raise the matter on the Adjournment.
The closure of James (Roscommon) Limited, hot on the heels of Stainless Steel Limited, with the loss of 113 jobs, creates for Roscommon town a job crisis never before experienced in the history of industrialisation in the area. The James factory was officially opened in 1979 by the Nicholas Group, a multinational firm better known for the production of the Aspro tablet; approximately 116 personnel were employed. They had difficulties over the years and the firm were taken over by Kiwis some time ago. They dropped the sweets division in Roscommon. They were very popular sweets but, due to trading difficulties, they had to cease production. However, they opened up a balloon printing and packaging firm which created 34 new jobs.
Last Friday, 30 March, the work force were summoned to a meeting in the canteen at 11.30 a.m. and informed by the manager that the factory was closing down, which was the first indication the employees received that the firm were in difficulties. It is regrettable that the manager only gave 30 minutes for the factory to be vacated by the workers. This is a new low in industrial relations. The closure of this factory is just the latest in a long line which commenced with the closure of the Allum factory in Roscommon town and continued with the closure of IDE Fashions, Castlerea, with the loss of 18 jobs. Fenner Stone then closed with the loss of 46 jobs and Stainless Steel, Roscommon, also closed with the loss of 113 jobs on 16 March 1984 when the factory ceased production after 12 years. The jobs of the workers in James, Roscommon, have been terminated as and from last Friday.
I call on the Minister for Industry, Trade, Commerce and Tourism to designate Roscommon as a crisis area for unemployment as over 2,000 people are now on the live register, not including the recent closures, which will bring the number up to 2,200 unemployed. Over 680 of those are under the age of 25. The Government should designate the Roscommon region and part of East Galway as a desert as far as employment is concerned. They have suffered greater losses in proportion to the total number in the industrial work force in the county than any other constituency.
We had evidence of the activity of the Government in relation to difficulties in the Southern region when they set up a special task force to consider the seriousness of the unemployment situation, especially in Cork. It is time that the Government, in co-operation with the IDA, designated Roscommon as a black area for unemployment. They should set up an active committee to consider the possible creation of extra jobs in the region through State agencies and private enterprise. The IDA in particular should give the region the priority it deserves. The Government should also establish an AnCO training centre for retraining workers to cope with possible industrial developments in the future. There is plenty of vacant factory space available which would accommodate such a development.
I also ask the Government to expedite a decision regarding a replacement industry for the James premises. I am pleased to have been informed by sources in the IDA that there is great hope for a breakthrough as far as negotiations are concerned for a replacement industry in the confectionery field which would take up the accommodation of the James building. I hope the IDA at the board meeting in seven days will make a decision in regard to this proposal which would immediately alleviate the problems of the workers affected by the James closure. In that regard, the employees of the James factory with their expertise in the confectionery field should be given special priority as far as a replacement industry is concerned. I also appeal to the Minister of State, Deputy Collins, to give special consideration to an alternative industry in the Stainless Steel premises. That building is owned by John Holt and Company Limited, a British firm, and the IDA should enter into negotiations to purchase the building and contents to enable an alternative industry to be set up. the history of the building is rather tragic because, prior to the closure of Stainless Steel Limited, there was a firm operating there manufacturing dry cell batteries. Prior to the setting up of that factory I, as a young member of the Roscommon Development Association, and long before I entered politics, was involved in negotiations for the site of the building and promoting industrial development there in the sixties. It is a well designed, functional building which could be easily adapted to a modern steel-works. I am anxious to see an alternative industry which would utilise the skills acquired by an experienced work force over 12 years, since the start of Stainless Steel Limited in Roscommon. They manufactured a very high quality sink unit for domestic and commercial use and, with the experience they have built up, they would be an asset to any firm considering setting up in Roscommon. The IDA, if they have not done so already, should enter into negotiations to purchase the complete building, including any fittings that may be left.
I also appeal to the Minister and the Minister of State to actively promote the provision of small industries in the three remaining 3,000 square feet factory units which are located on Racecourse Road at the rear of the Stainless Steel building. They should also negotiate for the Rohan factory which was built under the privatisation of industrial projects some time ago.
The Deputy is straying from the subject under discussion.
I wish to refer also to a replacement for Fenner Hydraulics in Castlerea which has closed. The closure of James Limited last Friday at very short notice has created a major problem. This is the first opportunity I have had to set out the serious difficulties that have arisen in my constituency as a result of job losses in the industrial sphere and it gives me an opportunity to express to the House and to the Minister my concern about this matter. I have been a public representative in the area in question for ten years and I have been a Member of this House for nearly seven years. What has happened in the area has caused gloom and doom.
The Deputy may not develop a full-scale discussion on employment or unemployment in the area. The notice he gave to the Chair regarding the question he wished to raise confines him to commenting on the closure of the James factory.
I am referring to the difficulties that have arisen because of the closure of the factory. I hope I will be able to speak of the serious effects on Roscommon town and the surrounding areas. Surely I can speak of the social implications——
No. Strange to say, if the Deputy had given notice that he intended to discuss unemployment over a wide area his request would have been disallowed as the matter would have been deemed to be too wide-ranging for a debate on the Adjournment. It appears to the Chair that this is what the Deputy is doing now.
I shall conclude because I wish to give my colleague an opportunity to outline his views on this matter. I think I am in order in referring to the difficulties caused by this closure to the staff involved. The 34 people involved have been working in the factory for five years. Men and women have been employed there, both married and single, and many have mortgage commitments with the county council and with building societies. This will create major difficulties for them, not in the short-term because of the cushioning effect of redundancy payments, but in the long-term situation they will face major difficulties. Last Thursday I dealt with a constituent who was employed in the factory and who was purchasing a house. At that stage he had no doubt about his future in the firm. On Thursday last he requested me, as a Deputy and a councillor, to assist him in getting a loan from Roscommon county council but on Friday his job was terminated. That was a sudden shock to him. Psychologically it will have a serious effect on those involved.
I hope the Minister will be able to offer hope to the workers, that he will give an indication regarding the negotiations that are in progress in connection with a replacement industry. I am hopeful they will be successful and I will not say anything that could prejudice those negotiations. They are at an advanced stage. I hope the replacement industry will be based on raw materials native to the area. When the factory was set up by the Nicholas Group it manufactured a popular sweet and it used sugar from the sugar company in Tuam. There is now a cutback in the purchase of confectionery. An industry based to some extent on raw materials available in the region will have a better chance of survival than one importing fully built-up manufacturing units for further development.
The IDA have a serious responsibility in relation to the future of this firm. The building is owned by the IDA and is well equipped. The manufacturing plant that was used for the manufacture of sweets has remained intact and that will assist in the setting up of an industry. My general experience with the IDA has been good. I know they are doing their utmost to provide industries but we are in difficult times. As a Deputy for Roscommon, I appeal for special consideration for the area in the light of the serious difficulties that have arisen, particularly in recent times.
I thank the Deputy for giving me some time to speak on this matter and endorse the sentiments he expressed with regard to the closure of this factory. People were aware of difficulties in the factory but the workforce got notice last Friday with indecent haste that their employment had terminated. I deplore the way the workers were told that they no longer had a job and were made redundant.
This factory was opened in 1979 with projected employment for 210 people. Unfortunately the number never exceeded 110 and 68 of that work force were let go in 1982. On a number of occasions I have discussed with the Minister and the Minister of State the serious unemployment situation in Roscommon. The closure of the James factory has added to the disastrous situation.
We have an unparalleled level of unemployment. People with mortgages or those purchasing local authority houses are now unemployed and face serious difficulties. What has happened will have a detrimental effect on the social fabric of the community in Roscommon town and county. While I know it is very difficult for the Government and the Minister to create industrial jobs in the west of Ireland, it is important and vital that the Minister should inform the IDA of the serious situation that exists in Roscommon. He should impress on them the importance of encouraging industry into Roscommon town and county.
The closure of James Limited followed the closure of Stainless Steel and Fenner Stone earlier this year. There have also been a number of other closures such as Allum, Rosco, Plastics and Strieder stretching back to 1979. This has been a disastrous five-year period for the county and particularly for Roscommon town. Up to six industries have closed leaving us with only three manufacturing industries.
With the previous speaker, I appeal to the IDA to leave no stone unturned to ensure that replacement industries are sought immediately for James Limited and for the Stainless Steel factory. It is vital that the people involved should get a job and earn a living. Without that there is no future for anyone in Roscommom. The social and economic life of the town will stagnate if it does not get an industry immediately. I accept that the Minister is doing everything possible to get one. I appeal to him to ensure that the IDA give top priority to that area as was done in another region. It is vital that we get some replacement.
The fact that a number of other industries closed in the area has aggravated the problem. I am referring to Finner Stone in Castlerea, IDE Fashions and Tritex. The closure of those factories has affected the area greatly. I appeal to the Minister to do everything possible to get a replacement factory for Roscommon as soon as possible.
I am grateful to the Deputies for raising this important matter. It was with regret that I became aware of the decision to finally close James (Roscommon) Ltd. The company had made every effort to maintain employment at the factory, even to the extent of diversifying away from production of confectionary to the processing and packaging of balloons. This was intended to form part of a wider novelty products operation and the company is to be commended for its efforts to maintain as many jobs as possible. In the event, James had no choice but to cease operations in the face of continuing and serious financial losses. When James was established in 1979 it was hoped that the company would become a major employer in the Roscommon area. The company, which is owned by a multinational pharmaceutical group, Nicholas Kiwi, formerly Aspro Nicholas, was established to produce a new confectionery product. The new product, a small fruit-flavoured sweet, was sold in special containers which had a secondary use as toy building bricks, similar to and compatible with, "Lego". In the event, the container, which was more expensive than the sweets which it contained, did not turn out to be the selling point it was expected to be.
In common with the confectionery industry in general, the company's product was affected by the recession and the consequent reduction in disposable income. An increase in VAT on confectionery in the UK, from 8 per cent to 15 per cent, also had a serious effect on sales. James never got near its projected level of output and employment only reached less than half the projected figure. The company continued in operation, in the face of serious losses but, eventually, several months ago, the company was forced to cease production of sugar confectionery altogether. As I have already indicated, however, the company's efforts to diversify into novelty products failed and the result was the total cessation of the operations at the factory on Friday last. I should point out that the company gave one month's pay in lieu of notice.
If I may sound a note of optimism, however, I am in a position to inform the House that the IDA have already reached an advanced stage in negotiations with another company concerning a takeover of the James assets and with a view to resuming operations at the factory. While I cannot be more specific at this stage — I am sure Deputies will understand the reasons — I am hopeful that the IDA's efforts will result in a resumption of operations at the factory and that a viable and lasting industry can be established there. I can assure the Deputies that I have been keeping in close touch with that situation at James and I will continue to monitor the situation in relation to a possible takeover, I will support, in any way that I can, efforts to reopen the factory and restore employment.
With regard to the employment situation generally in Roscommon, I should like to state that Minister Bruton recently had detailed discussions, at the request of Deputy Naughten, with Mr. Pádraig White, Managing Director of the IDA. It is agreed that a serious problem exists, with the level of unemployment in the county being over and above the national average. I can assure the House that every effort will be made to attract industry to Roscommon despite the very limited amount of mobile international investment capital available in the present difficult economic climate. We all hope that the recession in the United States will lift and result in a flow of investment funds from the US to Ireland. The efforts of a number of Ministers in the US recently should help to encourage further investment in Ireland.
With regard to the designation of Roscommon-East Galway I should like to tell Deputy Leyden that designation is not necessarily an answer to unemployment in any area, there are many facets which attract industry such as railway, manpower, trained personnel and a suitable advance factory. However, I will bring this matter to the attention of Minister Bruton, and the IDA, and I will get the Deputy a response to that suggestion. A suggestion was also made that a new training centre should be established by AnCO in the area. That matter, as the Deputy will appreciate, does not lie within the responsibility of my Department but I will bring it to the attention of the Minister for Labour and I will ask him to respond.
I appreciate the frustration and sadness which unemployment brings to Roscommon and other parts of the country. I sympathise with the people of the area but I am hopeful that we will see light at the end of the economic tunnel in the next two or three years and that we will see a substantial increase in the level of investment in new industries.
The Dáil adjourned at 9 p.m. until 10.30 a.m. on Wednesday, 4 April 1984.