Deputy Wilson, and he has 40 minutes.
Private Members' Business. - Irish Shipping Limited: Motion.
I move:
That Dáil Éireann, in view of the loyal service given by employees of Irish Shipping to the people of Ireland until the liquidation of that company in November, 1984, calls on the Government to:
(i) pay adequate compensation to the staff of Irish Shipping of six weeks salary per year of service; and
(ii) restore the pensions of all former Irish Shipping staff to their pre-liquidation level;
and further calls on the Government to recognise the strategic and economic necessity for a national deep sea merchant shipping fleet and to provide for the reconstitution of such a fleet.
I am very pleased that we have the opportunity to discuss this motion. I would wish to be in better voice for it. The purpose in putting it down is to try to change the Government's attitude on the treatment of the workers in Irish Shipping Limited, those who were in service when the company was liquidated and those who are on pension. Also we on this side of the House are trying to get the Government to do what we had promised to do, namely, to recognise the strategic and economic necessity for a national deep sea merchant shipping fleet and to provide for the reconstitution of such a fleet.
We have on numerous occasions, most recently on the occasion of the introduction of the Estimate for the Department of Communications, stressed our commitment to the Irish Shipping workers, but I think that at this stage, judging by the deaf ears upon which our words have fallen now, the Fianna Fáil Party seem to be the only channel through which the workers' grievances can be channelled and discussed openly with a view to changing Government policy with regard to the treatment of these workers. Once more I accept that the years of service from 1941 on, when the company were established, the workers have given to one of our prestige State companies should get better recognition than they have got from this Government. The service has been unique, shining, as Deputy Kelly said, like a fair deed in a naughty world, to quote an interruption from him during the Estimate debate.
I would like once more to emphasise to this House that the industrial relations of Irish Shipping Limited, the way that the workers in Irish Shipping Limited and the management controlled their affairs for the 15 or 16 successive years up to 1983 when the company were making a profit, are the ideal industrial relations both for State companies and for private companies. I must say that the workers, those who were directly affected — namely, the staff in Irish Shipping Limited but also those in other State companies and even in private companies — must be disillusioned if at the end of that kind of period of excellent industrial relations they can be treated as these workers have been treated. What the workers over and over again, in public statements from their trade union and in representations to Members of this House and members of the Government as well as of the Opposition, have been looking for is the kind of treatment which the chief executive of the company received on his retirement. I put it on the record of the House that they are seeking six weeks' pay multiplied by the number of years of service. That is what they are seeking as well as the restoration of their pensions.
We had before the House comparatively recently a Supplementary Estimate to deal in part with some of these workers. It dealt with an ex gratia— Lord save the mark — payment to pensioners which was being paid to certain pensioners by the company prior to the liquidation. The Minister came into the House and made something of a virtue out of doing this for those who served on Irish ships during World War II. I gather that this affected only 23 in all of the workers, and at that time I asked on behalf of my party that all pensioners be included in the new arrangement. The Minister of State said that because of financial and legal sensitivities — those words take the biscuit — he could not go any further, he could not expand the benefits to cover all the workers in Irish Shipping Limited. Financial sensitivities, begorrah. When I had a look at the Estimate sheet which the Minister gave us at that time I noticed that at least for this year all he was asking was an ex gratia payment for certain pensioners of Irish Shipping Limited of £51,000, then I see appropriations-in-aid of £50,000. The net total required was £1,000. If you, a Cheann Comhairle, and the House consider that this £1,000 involves any kind of financial sensitivity then you and the House are softer than I would have thought.
What the financial sensitivity would be if all the pensioners were included I do not know, because we did not get the benefit of that information from the Minister of State at that time.
There were also legal sensitivities. That gets under my skin totally. This is the House that deals with legislation. Here is the place where a Bill could be brought in to nurture the sensitivities or wipe out the sensitivities or get rid of or whatever we have to do with these legal sensitivities. This is the House that could do it. We submitted at that time, and I submit now, that this is the House where that should have been attended to by legislation.
I referred in the Estimate debate to the growing practice of throwing the umbrella, at one time the sub judice umbrella, another time the liquidator umbrella, over statements in this House. The Minister did not give the House the benefit of his thoughts about the sensitivities at that time. I presume he meant something to do with the liquidator. When will the liquidator finish business with regard to Irish Shipping Limited? It is an important question in regard to the substance of this motion. At least there must be an educated guess as to when it will be finished and then we can move on to formulate other policies for the future of Irish merchant shipping.
I have said that the workers deserved well of this country, especially in time of danger. I quoted here the story of a man, now a pensioner, whose ship was torpedoed and sunk and a month later he was on board another Irish Shipping vessel serving this country. I do not have to go through that story again, however much worth the telling.
Irish Shipping workers also deserve well because they saw that management seemed not to be steering the course they should be steering, long before the liquidation. When speaking on 13 June last I quoted part of the submission by the Federated Workers Union of Ireland to the Oireachtas Joint Committee on Commercial State-sponsored Bodies. column 1449, volume 359, of the Official Report states:
There are problems with the management structure of Irish Shipping Limited and these problems need to be addressed. In the main, we feel there is a bunching of the managerial functions in the hands of a small number of people. It is true to state that very important and far-reaching decisions are being taken by two or three people with little if any reference down the line. Since 1973, the Irish Shipping management group has been reduced from seven to five and at present six management functions are vested in two individuals. It is astonishing to note that the general manager, since his appointment last year, continues to carry the full functions of administration manager and personnel manager. This is entirely inefficient and likely to lead to decisions which will cause the company considerable discomfort.
This indicates that the workers were alert to certain weaknesses, dangers and difficulties and I am advancing that as an argument for the State's treating them fairly, justly and equitably. This is the kind of advice that was coming from the committed workers of Irish Shipping Limited whose case I am pleading tonight. It showed they were committed, serious about their work, and anxious that their company should be well managed and successful. That is a very strong argument indeed for this House to take their plight into consideration and to do what we ask in this motion tonight.
I cannot command words effective or strong enough to urge on this House reconsideration of the matter. If I could get a promise from the Minister for Communications, even an indication that the case might be prised open fractionally, then the effort would be worth while. I appeal most vehemently to the Minister. I do not know where the Minister for Communications is but he may be otherwise engaged. He has a Minister of State but I see the Minister for Health and Minister for Social Welfare has to stand in. I refrain from criticising in the hope that perhaps he, as a prestigious member of the Government, could weigh in strongly on behalf of these workers to see that they get what in all justice they deserve from the Government, since the Government wholly owned Irish Shipping Limited.
The second part of the motion calls on the Government to recognise the strategic and economic necessity for a national deep sea merchant shipping fleet and to provide for the reconstitution of such a fleet. We have appealed to this House on numerous occasions since November last year. We have appealed to the Government even in principle to make a commitment to the establishment of a deep sea Irish fleet. Due to weaknesses in management the chartering section was expanded to meet coal, steel and timber shipping demands which were never made. Therein lay the big weakness which was referred to by the workers in their submission to the committee. This part of the motion addresses itself to the same request to the Government.
It is generally conceded that when there are wars or major international disturbances it is a case of "every man for himself". I have read very carefully all the speeches written by Seán Lemass, Minister for Industry and Commerce and afterwards Minister for Supplies, relating to transport in the thirties and forties. He had a natural commercial bent and the wisdom that one gathers with the years. I quoted elsewhere a statement he made with regard to a certain commodity, that he thought he had a gentleman's agreement with certain people but, when war broke out, they did not stand by it. He said caustically that you can only have a gentleman's agreement with gentlemen.
In times of crisis, the national needs of trading companies will be met first. We are supposed to have a great rapport with the United States but, even before they came into the war, they were not over concerned with our plight. I suppose we cannot base an argument on necessity in time of war although, in the kind of world in which we live, there is no surety that a dangerous and wide conflagration will not break out at any time, particularly in the Middle East. For that reason, the words of our motion are important and the sentiments expressed in that part of the motion should be listened to and acted on.
One could argue that even from the point of view of national prestige, it is important to have a deep sea merchant fleet. The cynics may say that prestige butters no parsnips and that is true but there is such a thing as national morale and morale gets sustenance from the prestige that comes from owning a deep sea merchant fleet, among other things. I also include Aer Lingus. There is such a thing as morale in a community and it helps economically as well. If you come down to my constituency — the Ceann Comhairle knows what I am talking about — you will see what Mr. Barry McGuigan's win did for a small community. It lifted it businesswise and in many other ways. In the same way, a country like Ireland has or has not strong national morale. That morale is sustained and fed by having profitable trading companies such as Irish Shipping were for the greater part of their existence.
I wish to quote from the OECD book, page 127, Maritime Transport 1983 Paris 1984, to show what small countries have by way of fleet, and perhaps it will indicate the lines on which the Government and the House should be thinking. Belgium has 3,690,000 dead weight tons; the figure of Denmark is 7,926,000 dwt; Finland, which has a frozen sea to its north and the Baltic freezes regularly, has 3,601,000 dwt. I shall skip the big countries. Iceland has 168,000 dwt. In 1983, Ireland had 266,000 dwt. We learned in school that the Netherlands is the size of Munster and it has 7,479,000 dwt. New Zealand, which has a smaller population than Ireland, has 270,000 dwt. Norway, again with a smaller population than Ireland, has 33,524,000 dwt, and Portugal has 2,161,000 dwt.
There are also figures in relation to the world fleet which are worth noting. Cyprus, like ourselves, is an island and they have 5,784,000 dwt. Malta has 1,342,000 dwt. I am asking the House to take note of how those small countries see their national interest. I submit that we should see our national interest in the same way. I did not quote figures for Switzerland which has no coastline nor for Austria but the figures are there and they are reasonably substantial. Are we saying that we have a wisdom that the Danes, the Dutch, the Norwegians or the Finns do not have? If we are, we are being stupidly arrogant. They know how important it is to have their own deep sea fleet. The figures I gave were for mid-1983. I also have the figures for ships of Irish Shipping Limited and I invite the House to study the booklet published by the Irish Maritime Institute on Irish ships.
The institute, on a shoestring, have been indulging in propaganda, in the best sense of the word, and have supported Irish ships over the decades. Dr. John de Courcy Ireland is a tireless writer on the importance of shipping to this country and on the important contribution which Irish sailors and men of the sea have made, not merely locally, but throughout the world.
It is worth reading that booklet and subtracting Irish shipping from it and then contemplating what is left apart from B & I and their subsidiary. It is worth looking at it because what we see there cuts the ground from under anybody who is arguing that is what is left is adequate. I think I am right in saying the Taoiseach advanced that kind of argument in the House on the occasion of the announcement by the Minister of the liquidation of Irish Shipping. There is no way that what is left is adequate, however efficient and praiseworthy the efforts of the various small, in world terms, shipping companies may be.
I make the point to indicate that we need something more. The booklet covers the whole range. It covers Irish Shipping, now in liquidation. We can only ridicule the idea that what is left when Irish Shipping have gone — B & I are not a deep sea fleet — is adequate in any way to deal with the needs of the country. I had a communication in regard to Irish Shipping from Deputy David Andrews who told me that Irish Shipping was selling 42 paintings and five large models of ships in the open market. I appeal to the Minister to have a look at that and, perhaps, make a decision to buy those items for the nation so that they do not leave the country. They are a valuable collection, more valuable to us than they would be to any outside buyer.
Time and again I have suggested that the Irish Spruce which found itself at Marseilles having a propeller refitted when the liquidation hammer fell — that ship was built specifically on the order of the Irish Government to bring coal to the Moneypoint power station in Clare although the Minister told the House there was no definite contract in that regard — should be used as the base for a new deep sea fleet. I know there are all kinds of complications about purchase money, and so on, but there is nothing that cannot be solved with the proper commitment.
In this context it is important to know the date for the finalisation of the liquidation proceedings. I am aware that Irish Shipping workers made proposals to the Government with regard to a co-op for the management of the Irish Spruce. If the Minister decides that there may be a way forward there — I suppose he may have to await the finalisation of the liquidation proceedings — let him go that way. If necessary let him from a State company and thus build up a fleet. I want to make it clear that I am talking about the 200,000 ton dwt. range for a small efficiently run and managed Irish deep sea fleet. Let it be a private Irish company. Let it be a joint venture between the State and private enterprise but, for God's sake, let us have a deep sea fleet.
Another point I should like to make is that the revival of a deep sea fleet requires trained personnel. At the moment we have men of great skill, up to the rank of captain, idle. They are available for the manning of ships in a deep sea fleet. For God's sake let them not lie fallow. Let them not remain idle in our State to wither because they cannot practise their skill. With regard to the training system that has been developed I should like to call the House's attention to the danger of breaking the chain. In educational matters if there is a gap it is difficult to set it up again. The United States found that in certain areas of study. When they cast them aside they had to import the brains from elsewhere after they had foolishly allowed a break in the chain. They had the money to do it.
It should not be forgotten that if the chain is broken, if there are no facilities or trained personnel coming on the market, a decision of a future Government will be hampered in this regard. If we are to have a deep sea fleet in the future we will have to have foreign crews. That is not our idea, nor was it the idea by definition of Irish Shipping when they were established. Irish Shipping were established to serve a need during the war. The ships had to be Irish owned, Irish crewed and flagged. That is the kind of Irish Shipping company we are making a plea for tonight.
In the debate on the Irish Shipping (Amendment) Bill, 1984, the Minister said that the ancillary activities of Irish Shipping provided a profitable cushion against losses for Irish Shipping Limited. What happened the cushion? Did we lose the cushion? Why did we not siphon off or take off the profit-making ancillary activities that provided this cushion against losses before the liquidation took place? Why were Mombasa, Taiwan and Marseilles the locations of the ships when the liquidator was called in? Lough Swilly or Cork could have taken them. Those ports should have been their home before the liquidation occurred, not with a view to diddling anybody out of their just entitlement, but with a view to being in control of what happened and giving more control to the liquidator.
I gather that the Irish Rowan has been sold, given away to a Yugoslav company. The ship was worth £15 million but $2.5 million was the price paid for it. That is the kind of thing that is heart breaking for anybody who has the interest of a deep sea fleet or the country at heart. I should like to emphasise how important it is, not merely for the workers who have lost their jobs and their careers, that the State companies and the private sector. They must take note of what can only be regarded as savage treatment by the State of employees after years of service given with perfect industrial relations and a commitment which prompted them to make the type of submission I read into the record of the House.
We should not forget their entitlement to redundancy payments. We should not forget the entitlement of pensioners. All we are asking is that the rest of the pensioners get what the Minister, Deputy Nealon, got for the group who served during the Second World War. That is the purpose of the motion. I ask the House bona fide to consider our motion in that way. This is not a political point scoring exercise. It is an effort to see that justice is done to a certain group of people and that the State addresses itself to the establishment of a deep sea fleet for the future.
I move amendment No.1:
To delete all words after "Dáil Éireann" and substitute the following:—
"notes the action taken by the Minister for Communications to deal with the problems arising in the aftermath of the liquidation of Irish Shipping Limited."
This motion before the House is reckless and irresponsible. It ignores several issues of a fundamental nature in this extremely difficult and sensitive situation which exists in the aftermath of the liquidation of Irish Shipping Limited. The motion is not concerned at all with the wider implications of what the Government are being asked to do. It ignores any legal or financial constraints which might be on the Government or the Ministers concerned.
Of course, this whole House is united in sympathy with the former employees of Irish Shipping Limited who are the innocent victims of outrageous and irresponsible decisions taken by the company in 1979 and 1980 without informing or obtaining the consent of the Government Ministers directly concerned. Even making due allowance for the benefits of hindsight, it is difficult to see how any responsible management could have taken those chartering decisions which led inevitably to the downfall of the company, one of the most unfortunate and tragic aspects of which was the loss of employment for people who had served the company well.
The background to the liquidation of Irish Shipping Limited was set out in its fullest detail in my statement to this House on 14 November 1984 and I do not see any necessity to repeat all the details I gave on that occasion. Furthermore, Irish Shipping Limited are now in the hands of a liquidator who has been appointed by the High Court and the Government have, therefore, no longer any function in relation to the company. It would in fact, be quite improper for me to discuss any aspect of the liquidation process and I do not intend to do so.
I pointed out in my statement on 14 November that the cost of keeping Irish Shipping Limited going for the next five years would have amounted to about £144.5 million with another £60 million approximately still owned after that. To put this whole matter in a clearer perspective, this means that it would have cost the Exchequer over £76,000 per job per year, or about £380,000 for five years, to maintain each job in Irish Shipping Limited for the next five years with no real expectation that the company would be viable at the end of that time. I have no doubt that the Irish taxpayer would agree that it would have been economically and socially indefensible to use limited State resources to keep Irish Shipping Limited in operation at such a cost.
There were, of course, certain liabilities in respect of borrowings and other commitments by Irish Shipping Limited which had been guaranteed by the Minister for Finance and these legal obligations and guarantees are being honoured by the Government.
It is now nearly eight months since the company went into liquidation. In November 1984 the Tramp Trip Charter Index of the General Council of British Shipping stood at 113. In April 1985 it was 100. I have not yet got the May figure. According to Lloyds Shipping Economist, a highly reputable trade journal, freight rates for medium sized dry cargo bulk carriers — 40,000 tons to 80,000 tons deadweight — have generally been depressed over the past year. While there has been a growth in trade since the beginning of 1984, this has not been matched by a recovery in freight rate levels. This is mainly due to chronic overtonnaging in the sector, which makes any sustainable improvement in rates unlikely. Despite significant annual demand growth of 7 per cent there has been a deterioration in tonnage balance as supply climbed by 9 per cent. In February 1985 there was a surplus of supply over demand of 17.3 million tons deadweight, equivalent to 40 per cent of demand.
Freight rates for handy size dry bulk carriers — 10,000 tons to 30,000 tons deadweight — have also failed to show any real signs of recovery. Indeed, current freight rates for the type of handy size vessel owned and chartered by Irish Shipping Limited — about 30,000 tons deadweight — are significantly below the levels of a year ago. This can also be attributed to overtonnaging. In February 1985 there was a surplus of supply over demand in this category of 20.6 million tons deadweight, equivalent to 29 per cent of demand.
The figure therefore of £144.5 million which I have quoted earlier was based on advice from reputable international shipbrokers obtained by the then chairman of Irish Shipping Limited. At the present time freight rates in the deep-sea sector are even worse than that advice anticipated. Panamax vessels, of which there were five in the company's fleet, are earning about $1,000 a day less than forecast. The smaller vessels are also having a bad time. At the same time costs are increasing. The situation, therefore, is that the company's losses would have been very substantially greater this year alone if they had continued in business.
Not surprisingly in these circumstances, shipping companies continue to go to the wall. One of the latest casualties is the Reardon Smith Line, the Cardiff based shipping company with which Irish Shipping Limited were associated in Celtic Bulk Carriers. Reardon Smith Line went into voluntary liquidation at the beginning of this month. The company's chairman attributed their downfall to a sharp fall in ship values and the persistent weakness of freight rates.
I do not, however, consider it necessary to justify again the Government's decision not to make any more money available for Irish Shipping Limited in November 1984. That decision was clearly the right one as anybody who examines the situation objectively and knows the circumstances of the world shipping industry will agree. This country, in the present financial and economic climate, simply could not afford to accept responsibility for the enormous financial commitments entered into by Irish Shipping Limited, without — and I think that I should again repeat this — without the knowledge or consent of the then Government or of the Ministers concerned.
The situation of over 30 ship officer cadets training with Irish Shipping Limited was affected by the liquidation. Arrangements were made, however, with the liquidator for the continuation of the training up to June 1985, with the Youth Employment Agency meeting the cost and other Irish shipping companies providing the necessary sea time. My Department are at present consulting with the other parties with the objective of seeking longer term arrangements for the cadets affected by the liquidation and I am hopeful of a successful outcome.
The payment of redundancy compensation to the company's employees would normally be the responsibility of the liquidator. Since, however, there were no funds to meet the payments, the Minister for Labour was obliged to pay the redundancy lump sum in full to the employees from the Redundancy Fund. The processing of the relevant redundancy claims was and is being dealt with expeditiously by the Department of Labour. There are no funds available from which compensation payments other than statutory redundancy entitlements can be made.
The suggestion that extra-statutory redundancy payments might be made to ex-employees of Irish Shipping Limited is also affected by other serious constraints. The position is that the company are in liquidation, having insufficient assets to meet their liabilities. It must be borne in mind that there are creditors of the company who have lost a great deal of money through the liquidation of Irish Shipping Limited. In the circumstances of the liquidation of Irish Shipping Limited, it would be improper to seek to give preferential treatment to former employees of the company.
The motion also asks that the pensions of all former Irish Shipping staff should be restored to their pre-liquidation levels. I should explain that pension arrangements for employees of Irish Shipping Limited were a matter for the company and the pension arrangements in force at the time of the liquidation of the company were those established by the company. The company operated three pension schemes — one for senior executives, another for sea-going staff and a third for shore-based staff. Although section 3 of the Irish Shipping Limited (Amendment) Act, 1984, provided that my approval would be required from then on for any alterations in the then existing pension arrangements, I was not in fact called upon to exercise that power in regard to these pension schemes. It must be emphasised that I have had no function, statutory or otherwise, in the pension schemes that existed at the time of the liquidation.
The ex gratia portion of the pension was, of course, unfunded and was met out of the company's revenues. It was not paid out of a pension fund and the company were under no obligation to pay it. So far as the Department understand the matter, the ex gratia retirement payments made by the company arose mainly from limitations in the pension fund provisions in regard to adjusting pension amounts to cost of living increases. The company, presumably, decided to make these ex gratia payments as a way of topping up the pensions in question. In addition, some ex gratia payments were made to retired employees who were not in pension schemes. The level of these ex gratia payments was a matter for the company and when they went into liquidation the continuation or cessation of them became a matter for the liquidator appointed by the High Court. In view of the nature of these payments, the liquidator could not continue to pay them.
It is an unfortunate consequence of the liquidation of Irish Shipping Limited that pensioners should be among the innocent victims. When the Government were considering the restoration of the ex gratia pension element, the possibility of extending this concession to all pensioners of the company was considered. Due to the financial and other sensitivities involved, it has not been found possible to do this, however much we would like to do so. It is not that the sum involved would be so daunting. However, after very careful consideration it was felt that there was a particular category of former employee to whom, without creating a precedent or offending any sensitivities, and exceptional consideration in the matter of ex gratia retirement payments could be applied, and in restoring those payments to those who had service aboard Irish ships during World War II, the Government concluded that it was recognising a very special service to the State.
Finally, the motion "calls on the Government to recognise the strategic and economic necessity for a national deep sea merchant shipping fleet and to provide for the reconstitution of such a fleet". As I made clear in my statement to this House on 14 November last, this aspect was considered by the Government and they were satisfied that the winding up of Irish Shipping Limited was not a cause for concern in terms of our current strategic needs.
In the aftermath of the liquidation of Irish Shipping Limited, I am carrying out a review of policy in relation to the Irish merchant shipping industry. It is more than 20 years since the last major review of the strategic fleet concept. Circumstances have changed considerably since then, both in the development of modern ships travelling at higher speeds and operating with greater efficiency, as well as the development of air transport, and in the nature of emergencies which might occur.
The requirement of a strategic fleet has traditionally derived from the policy of successive Governments on Irish neutrality in the event of armed hostilities involving Europe. We might remind ourselves that during the last war the maximum effective tonnage did not exceed 45,000 tons deadweight. Nevertheless, the ships and their crews played a major part in maintaining effective imports during the most critical period of the war.
Towards the end of the war, it was decided that Irish Shipping Limited should continue their activities in the post-war period. It was also decided that the size of the company's fleet should be determined by reference to the minimum tonnage requirement to carry essential imports to the country in time of war. At that time this was estimated at 250,000 tons deadweight. In September 1958 this target was reduced to 200,000 tons because of the improvement in the overall efficiency of dry cargo vessels related to their increased size and speed. This target of 200,000 tons deadweight was in turn revised to 155,000 tons deadweight dry cargo tonnage in the second Programme for Economic Expansion, following a further re-examination in the light of the modernisation of vessels and of changes in national requirements of essential commodities since the target was originally calculated. The company's growth was not, however, limited to the target figure, but expansion beyond that figure depended solely on commercial considerations.
The need, in modern times, for the maintenance of a strategic fleet, which was conceived historically in relation to conventional warfare, requires wider consideration and study. The question arises, for instance, of the relevance of a strategic fleet in an age of nuclear weapons. Moreover, there is a world surplus of shipping at present and this is likely to continue indefinitely. It would, however, be imprudent not to plan on the basis that future hostilities could be limited to conventional weapons or that there may be emergencies or international crises other than warfare which would create a need for nationally registered tonnage. It would not be wise to assume that other nations would come to our aid and meet our needs in such times of war or international crisis.
Because of the importance of foreign trade in the Irish economy, the diversity of the sources of our imports and destinations of our exports, successive Governments have felt that Ireland's interest lies more in maintaining reasonable freight rates than in maximising earnings from the relatively small shipping industry. Government policy, therefore, has been aimed at supporting the elimination of discriminatory practices in the shipping industry. The elimination of these practices should help to keep down freight rates and ensure fair entry in the world market for Irish ships. We have maintained this advocacy of free and fair competition in the deliberations on maritime policy within the European Communities. The EC Commission memorandum on shipping policy submitted to the Council in March 1985 is a welcome development in this regard. The Commission's formulation of a policy of non-protectionism based on the principle of free and fair competition is in line with Ireland's espousal of full commercial freedom of shipping.
Shippers here and abroad are free to use any of the services available. In any case, the nature of the deep sea trade to and from Irish ports offers little prospect of full and remunerative employment for a shipping company. This was demonstrated by the inability of Irish Shipping Limited to operate a regular liner service from Ireland economically when they made an attempt to do so some years ago. As a consequence, the company had to seek remunerative employment in the world tramp market.
If the maintenance of a strategic fleet remains a valid and realistic policy for Ireland, the current structure and pattern of Irish trade needs to be examined to determine to what extent the strategic or minimum needs of the economy could be met by a fleet owned or capable of being requisitioned by the Irish Government. Obvious needs would be fuel — coal, oil and petroleum products, in particular — food and other essential raw materials. Minimum necessary levels could be determined, and from these might be determined the number, type, size and distance capabilities of the ships which would be necessary to maintain those supplies. It seems to me that the aggregate tonnage which has heretofore been the prescription for the strategic fleet is a rather crude concept. It should be possible to define the structure and composition of a strategic fleet more precisely to correspond to present and anticipated economic requirements.
The present Irish fleet, excluding those vessels which were owned by Irish Shipping Limited, consists of 62 ships totalling about 187,000 tons deadweight. Apart from the Irish Spruce, there are 44 dry cargo ships on the register with a total tonnage of over 77,000 tons deadweight. This fleet operates mainly in the near continental trading area which generally encompasses ports in Ireland, Britain and Europe between Bergan in Norway and La Pallice in France, but excludes much of the Baltic Sea. There area also seven small tankers on the register with a total tonnage of over 22,000 tons deadweight.
There are, of course, obvious benefits to the Irish economy from a commercially successful shipping fleet in the areas of foreign exchange earnings, contribution to the balance of payments, employment of maritime personnel etc. As I have already stated, this question of a strategic fleet, its value, its structure, its ownership, its employment etc. has not been looked at for over 20 years. I have indicated that there are many fundamental questions which need to be considered and which clearly go beyond my area of responsibility. I have decided, therefore, as part of a general review of shipping policy which I am carrying out, to establish a Committee on Strategic Shipping Requirements representative of the Government Departments and other agencies concerned, to investigate and report on our current and future strategic needs and how these should be secured. I will be announcing the composition of the committee very shortly.
This tragic saga of the end of Irish Shipping has had extremely harsh consequences for many people, many of them innocent victims of decisions in which they played no part. I yield to nobody in my admiration for the workers of Irish Shipping Limited. They have served this country well. Their commitment to their company's interest has been a model for all workers and their conduct in the area of industrial relations has been exemplary. There is nobody, in Government or outside, who is not moved and concerned by plight of these workers. I constraints and sensitivities of the situation prevent me from taking further action to ease their lot.
I call Deputy Vincent Brady. He has 30 minutes.
This motion before the House, in the names of my colleagues, calls on the Government to restore some justice to the former long standing employees of Irish Shipping Limited. It also calls on the Government to restore the nation's independence by having its own shipping fleet, as is the right and expectation of any sovereign nation.
The Government's decision in December last to put a liquidator into Irish Shipping was disastrous for a great number of reasons. First, it dealt a huge demoralising blow and injustice to men who had given great service to Irish Shipping, in many cases at a time when there was great danger to those going out to sea in less peaceful times. The decision by the Minister left the liquidator with no alternative but to sack staff who had given many years of excellent service. Their only compensation was a statutory redundancy figure, with no proper pension scheme whatever attached.
The decision also left many men stranded in ports. Indeed, seven months later that situation still prevails, and Irishmen are stranded, not knowing what is likely to happen in the future and being left literally prisoners in a foreign country many thousands of miles away from home. That decision also placed a huge question mark over Ireland's credibility and creditworthiness abroad and has possibly done untold damage to the economic development of this country resulting from an Irish Government reneging on and dishonouring their responsibilities and guarantees. Ethics in any business undertaking is highly important but is much more so at international level where investments and borrowings are guaranteed by a sovereign State.
Irish Shipping Limited for many years had been a very viable undertaking and had not only created excellent employment and prestige for our country abroad but also gave us our independence in shipping in international waters. Credit must be given to all those involved in developing and building up the company over the years from their pioneering days.
We may never know what caused the real problems of Irish Shipping but we do know that the Government acted hastily. The Minister rushed in to appoint a liquidator and gave no consideration whatever for its effect on our credit rating at international level, which is probably causing a further deficiency of many hundreds of million of pounds a year on our national debt and repayments.
We were never told at the time of the liquidation what proposals had been brought forward by the board of Irish Shipping in their report and we were never informed of their recommendations. It is very clear, however, that the recommendations did not include liquidation but it is a tragedy for the country that the Minister did not tread more cautiously in a more statesmanlike way. Instead he rushed in, with the Government's approval, to appoint a liquidator within a matter of hours.
Not so long before the liquidation this House had passed legislation authorising the Government to guarantee Irish Shipping up to £75 million and following that any person or company doing business with Irish Shipping — bankers, creditors or others — were entitled to believe that when the State gave such a guarantee that there would be no question whatever of such a pledge or guarantee not being honoured by the Government of a sovereign State. Those pledges also gave some assurance to the employees of Irish Shipping at that time. Above all they were entitled to believe that there would be no question whatever of the Minister and the Government going back on their word and putting up the shutters in the most disastrous way possible, particularly by bringing in the liquidator.
Many of the workers had made commitments themselves on personal levels on the basis of the Government's guarantee but once again, and not indeed for the first time, they were betrayed by the Minister and their jobs and their livelihood were gone within a matter of hours. That is no way to run one's affairs and it is certainly no way to treat people who have given dedicated and loyal service to the nation's shipping line for many years, sometimes at great danger and great risk to themselves and to their families.
We are all also very anxious to know what is going to happen to Irish Continental Lines. They are a separate company that have been profitable and, again, not only have given good employment but have obtained a good reputation as an efficient and profit-making organisation. The employees of Irish Continental Lines are frightened and nervous. They have no assurance that their jobs are safe. We all know that the liquidator has been negotiating for the sale for some time now and very obviously the last consideration will be the independence of Irish Continental Lines and, even more importantly, the future of the men and women who are presently employed by that company with an obvious disregard for the contribution they have made to the success of the company, as happened in the case of the employees of Irish Shipping.
The problem in Shipping today is no different from that being faced by many business. The boards and directors of such companies have to take the rough with the smooth and behave in an ethical and proper businesslike way. Major problems have to be faced up to by all those directing and running businesses. If there are problems we rightly condemn and criticise those who abscond leaving behind their workers without jobs, their creditors sitting with little or no hope of ever being paid and a general unholy mess. We do not expect that from good business people of integrity and we certainly should not have to accept such a high-handed, unbusinesslike and dishonest approach from the State and the Government.
There was blatant mismanagement on the part of the board of directors of Irish Shipping in recent years. Of that there can be no doubt whatever. They abused the trust that the Minister of the day, and successive Ministers and Governments, had placed in them by getting involved in absolutely crazy, ridiculous and uneconomic deals, the type of which it is difficult to understand and comprehend from men of so-called business experience, knowledge and etiquette.
It is, of course, easily known that they were not dealing with their own funds. Many people are still asking if the liquidator intends taking action against those responsible, many of whom have other business interests and assets that are totally unconnected with Irish Shipping. Nevertheless in circumstances such as has happened in Irish Shipping, the liquidator should have the right to examine all possibilities in taking appropriate action to recover some of the lost funds and finances. The State and the workers are those who always suffer in situations of this nature and the Minister, before making his decision to appoint a liquidator, should also have considered this particular aspect of the matter.
It is very obvious to anybody with business experience and acumen that in the particular circumstances the Minister should have appointed a receiver, not a liquidator, and provided the receiver with a financial injection which would have assured the continuity of Irish Shipping Limited on a smaller scale but nevertheless we would still have Irish Shipping Limited as an independent and sovereign shipping line. Many jobs would have been saved and I have no doubt that within a few short years Irish Shipping Limited would have developed once again into a shipping line that we could have taken a pride in as we had done in other years.
A receiver at the time could have renegotiated the particular contracts which caused the major problems. I am sure that in the circumstances the main creditors would have been quite happy to have co-operated in thrashing out some deal satisfactory to them and which would have guaranteed the continuation of Irish Shipping Limited and employment in the company.
That was not possible.
The Minister can still retrieve that particular situation, although from his speech tonight it is obvious no progress will be made. Indeed at the time it should have been a priority of the Government to keep an Irish shipping company afloat and the solvency and credibility of the nation would not have suffered as it has obviously done since November last when that disastrous decision was taken.
I call on the Minister and the Government to accept our motion tonight. First, he should renegotiate redundancy terms and pensions with former employees who cannot be accommodated in a new Irish shipping company, and particularly those who have given long and faithful service to Irish Shipping.
Secondly, in the interests of our independence and credibility, a new shipping company must be floated. I have no doubt but that under experienced and efficient management we will again experience the pride and joy of having our own national shipping line and not having to be dependent on foreign shipping which will only drive up industrial and distribution costs, therefore, creating further and extensive unemployment which is already in a disastrous state.
I have seen a petition and a letter that were handed to the Taoiseach's office from the Wives Action Group of Irish Shipping. Any Deputy, and particularly the Taoiseach, on reading that letter should have given some recognition to the points made. It is clear from the petition that the wives requested a meeting with the Taoiseach but they were left waiting for seven hours before it was even accepted. They were ignored totally. Since then the Taoiseach has not only refused to meet them but has not even acknowledged receipt of the petition.
It is disgraceful.
In the circumstances that is absolutely irresponsible and disgraceful conduct on the part of the Taoiseach and the Government. It is obvious that the effects of the liquidation of Irish Shipping have been disastrous and traumatic on the families and on the wives of the former employees of Irish Shipping. It could be argued that the same effects can be experienced by the families of any unemployed persons but, in the case of Irish Shipping, we had a profitable and viable shipping line for many years. I have indicated that, given the chance, Irish Shipping could have been rescued from their financial position and could have prospered in the future.
I will quote a few points from the petition regarding the employees. It points out very seriously the psychological effects on wives and children of having a once cheerful, happy breadwinner turned into a depressed, morbid cast off with the resulting change in the home environment. It talks about the increased tension of visiting a husband in a psychiatric hospital, a former employee of Irish Shipping. When teachers complain about a child's lack of attention and change of personality in class and when it is explained to them that one's husband is ex-Irish Shipping, they understand immediately. It also deals with pensions and quotes the anxiety of a 75 year old single pensioner living alone with no wartime sea service. Her pension of £180 per month was reduced to £58 per month. She had to seek cheaper accommodation and change her surroundings.
I am sure the Minister has seen this document although it was addressed to the Taoiseach. There is an obligation on the Minister and on the Government to take some action along the lines of our motion. I appeal to the Minister to think big on this occasion and forget politics. I ask him to accept our motion which would be in the interests of the employees of Irish Shipping and the future of the company as a national shipping fleet sailing on a viable commercial basis throughout foreign waters under the Irish flag. That is the least we can ask the Minister and the Government to do. I sincerely hope that, despite his rebuttal of our motion in his speech tonight, he will reconsider the whole matter and agree to accept the motion as put forward from this side of the House.
When the Government decided to put Irish Shipping into liquidation the nation was shocked. As is generally conceded, the timing and the manner of this act was disastrous for the reputation of the country and, strategically, the decision to liquidate when the fleet was spread across the seven seas was illjudged. The morale of the nation received a body blow. Its effect is still evident and is felt throughout the country but mostly by the families and dependants of the staff of Irish Shipping.
The treatment meted out to the workers and pensioners of Irish Shipping was nothing short of scandalous and continues to be so. The ships were spread throughout the world and all of a sudden their lifeline was cut off. They were in Africa, France and the Middle East. Suddenly they were left without a job. Ships were impounded. Captains, workers and officers on board were at the mercy of who ever was in control in those countries or at the mercy of pirates on the high seas.
We have heard stories from those aboard the ships in Mombasa, the Middle East and Marseilles that they were subjected to treatment which they did not deserve. The reason for this was that the Government did not take into account what could happen to our citizens who were serving our country. They rushed in wildly without taking into consideration the danger our citizens would be placed in. Some people were attacked. Their ships were plundered and they were in danger of their lives on many occasions. The Government should have considered all of this in detail before making their decision. We are not talking in terms of financial and economic decisions but about human lives. This aspect has not been stressed strongly over the past number of months. The blame must rest with the Government.
Since the liquidation the families of the workers have suffered greatly. They did not know what would happen to them from day to day. In most cases when a company go into liquidation a decent redundancy payment is made. There is consultation and a fair amount of money is paid to those made redundant. What happened in this case? An offer of statutory redundancy was made to those working aboard the ships and on shore. Some members of the management got six weeks salary per year of service not long before the company went into liquidation. The chairman got £66,000 for retiring early but the workers on the ships, the middle management and office workers were treated in a most insulting and degrading manner. The Minister has defended the Government's stand on the treatment of the workers. They seem proud of what they have done. That is one of the reasons for our calling on the Government in this motion to pay adequate compensation to the former employees of Irish Shipping.
There is the case also of the pensioners of the company, some of whom joined the company when it was set up. The Minister tells us that because the pensions were being paid by Irish Shipping, there is no responsibility on him in that regard. That is not a sustainable argument. The Minister has power, if he has the will, to arrange for the payment of pensions to those who had been already in receipt of pensions from the company. Therefore, what is in question is the will of the Minister and of the Government in this matter.
Recently the Minister introduced a Supplementary Estimate for the purpose of providing ex gratia payments for some of the pensioners of Irish Shipping. Obviously, that move was welcomed but there is a certain amount of cynicism attaching to it because the decision was reached by the Government only after much pressure had been put on them in this regard, after they realised that the people generally were angry at the way in which the pensioners of the company had been treated. Consequently, the Government decided to give something as a token to those who had served Irish Shipping down through the years. This ex gratia payment is to be paid to 23 pensioners of the company but I submit that payment should be made to all the company's pensioners.
In opening his speech the Minister referred to our motion as being reckless and irresponsible.
A disgraceful comment.
It is difficult to understand how those terms could be applied to a motion which seeks to have paid to the staff of Irish Shipping adequate compensation for what has happened to them. We are talking about a motion which seeks a restoration of the pensions of all former Irish Shipping staff, which calls on the Government to recognise the strategic and economic necessity for a national deep sea merchant fleet and to provide for the reconstitution of such a fleet.
There was nothing in the Minister's speech that related to the motion before the House. Instead we were treated to a history of what he has done in the case of Irish Shipping. Throughout his speech there was the excuse that because the matter is sub judice it could not be gone into in detail. For some weeks past Deputy Kelly has been saying in relation to the setting up of new committees, boards and authorities that the power of the Government is being given away. I agree totally. In the past year or so I have noted that the Government's response to sticky questions is to invoke the sub judice rule or to say that because the concern in question is in liquidation or is in the hands of some other authority the Minister is not responsible.
There is, too, the very important question of the education of cadets to man a shipping fleet. By reason of the liquidation of Irish Shipping that education is being obstructed. In fairness to the Minister, he has arranged for the continued training at the Cork Regional Technical College of those cadets who have been there up to June 1985 but I am concerned that in future the process of this education will be broken. I fear that when we again have a merchant fleet we will not have available the qualified staff to man the vessels. The Minister must ensure that the training staff who are available in the Cork Regional Technical College are retained so that they do not have to go elsewhere to seek employment. Therefore, it is vitally important that the Minister announce immediately what his plans are in this respect.
On the last occasion on which we had an opportunity to debate the plight of the employees of Irish Shipping, I contributed to that debate as did many other Members from this side of the House also. The general point made then was that the employees were the victims of decisions that were totally out of their control and which were taken perhaps totally without their knowledge. While the employees of Irish Shipping have understood and been responsible in their understanding of the situation forced on them it is probably now out of the question that Irish Shipping Limited, as we knew it, can be restored.
This debate should concentrate on what can be done at two levels, first, the present position of the employees and their ension reights. Although the Minister has not addressed the subject with the urgency I should have liked, there is also the need to review the establishment of a shipping service here, one that would be a national service and of which we could be proud. We were very proud of Irish Shipping Limited and of their workers who gave loyal dedication and commitment to that company. Such review should be undertaken urgently. In changing world conditions it is essential that we keep abreast of changes and the strategic needs of an Irish shipping service, the type of service that will be needed. At the same time we are all aware that, in this respect, time is of the essence.
Debate adjourned.