Dáil Éireann díospóireacht -
Tuesday, 10 Jun 1986

Vol. 367 No. 8

Shannon Free Airport Development Company Limited (Amendment) Bill, 1986: Second Stage.

Minister for Industry and Commerce (Mr. Noonan,

Limerick East): I move “That the Bill be now read a Second Time.”

The principle purpose of the Bill is to provide for the further financing of the Shannon Free Airport Development Company Limited by extending the limits in current legislation.

Specifically, the Bill provides for

(1) an increase from £120 million to £130 million in the aggregate of the amounts which the Minister for Finance may subscribe in taking up shares in the company, and

(2) an increase from £60 million to £105 million in the aggregate amount of grant-in-aid, voted annually, which may be made to the company.

It also provides that the level of remuneration, allowances and conditions of the officers and servants of the company shall be subject to my approval given with the consent of the Minister for the Public Service.

Share capital subscribed to the company is used for capital expenditure on the Industrial Estate at Shannon and in the mid-west region and west and south west Offaly. The main headings of expenditure are land acquisition, construction of factories and ancillary works. A small proportion is expended on tourism projects of a capital nature.

The grant-in-aid moneys are applied towards meeting the company's running expenses and providing financial assistance to companies on the Shannon Industrial Estate. A substantial part of the company's running expenses relates to the administration of its small indigenous industry programme in the mid-west region where, however, grants for plant and equipment, training, R & D and other programmes come from the IDA under full delegated grant giving authority to Shannon Development. I should add here that the major proportion — 70 per cent — of their administration costs are generated by the company primarily from the rent on factory space.

In relation to running expenses, it is also relevant to point out that the significant element of these arising from the company's tourism activities used to be met by a special grant-in-aid for which the Minister for Tourism was specifically accountable, notwithstanding the fact that the amount comes within the overall limit being amended by section 3 of this Bill. Following reassignment of ministerial portfolios earlier this year, responsibility for this expenditure now belongs with the Minister for Industry and Commerce, which change will I hope facilitate a more coherent and integrated approach by my Department to their role in relation to the company.

Accumulated expenditure by Shannon Development under the share capital and grant-in-aid headings as at 31 May 1986 amounted to £91.6 million and £60 million respectively. In fact, the grant-in-aid limit has been reached and the company has been relying, in the meantime, on a combination of own resources income and bank borrowings to meet its obligations. It is, therefore, a matter of urgency that these limits now be increased. It is estimated that the increases proposed will suffice until 1990.

The type of control proposed in section 4 in relation to remuneration and conditions of the staff of the company is now being inserted in relevant statues governing the different State companies as the opportunity arises.

The last occasion on which legislation increasing the company's financial limits was enacted was May 1983 and while the company, as has the rest of the country, found the intervening period to be difficult, I am pleased to be able to report steady progress in all of the company's activities, in particular in the nationally important activity of employment creation with a total net growth of 400 in employment on the Shannon free zone and in small indigenous industry in the mid-west region. Today, employment on the free zone stands at 4,400 while small industry employment is now 5,300 in 700 firms. It is worth noting that in 1978 when the programme commenced, there were 350 small industry firms employing 3,000 people in the region. The increases since 1983 may seem small but must be looked at in the context of the declining trend for manufacturing employment on a national basis. An even more significant indication of the impact of Shannon Development initiatives is that the number of small firm exporters in now over 100 compared to approximately 20 in 1978.

One of the major developments affecting SFADCo which occurred since passage of the 1983 legislation has of course been the publication of the Government's White Paper on Industrial Policy in July 1984, the major provisions of which have been incorporated in the Industrial Development Act recently passed by the Oireachtas. This has direct relevance for the company both in relation to the promotion of industry on the free zone and to its small indigenous industry programme under the terms of its delegated authority from the IDA.

The objective of the new industrial policy will be to develop a strong and internationally competitive industrial sector made up of both Irish and foreign owned firms, creating and maintaining the maximum number of sustainable jobs, maximising value-added in Ireland, promoting more rapid development of our natural resource-based industries and promoting the integration of foreign owned industry into the Irish economy through greater linkages.

Shannon Development will be implementing the new policies and in particular will be applying the new selectivity criteria in vetting projects both in terms of focusing on the need to develop and increase linkages between overseas and indigenous industry and in particular to the development of import substitution and export markets. Employment creation, viability and technological content, will of course continue to be major factors in the assessment of projects.

As I have said, the development of our natural resource-based sector is a major plank of the new industrial policy. The Government have assigned to SFADCo the very important role of conducting a pilot project on the development of the food processing sector. The priority areas for action by the company include:

—increasing the number of highcalibre entrepreneurs operating well structured firms in the food processing industry;

—stimulating the development of quality new products;

—developing and testing initiatives and programmes which, if successful, will be applied on a national basis.

The company's new food processing centre at the Raheen Industrial Estate, Limerick, which I recently had the pleasure of opening is a practical example of what is needed in terms of the physical ambience and support infrastructure for this sector and as the 43,000 sq. ft. centre is already fully occupied construction of a further 20,000 sq. ft. will start before the year end.

The food processing and agri-business sector is one of the country's largest employers with approximately 20 per cent of the total workforce. The industry is well diversified in processing techniques and products. Additionally, it is well dispersed throughout the country giving it economic and social importance of national dimension. However, compared to other food processing countries our efforts are mainly concentrated in commodity products. As a consequence we miss out on price, profit and employment opportunities. I strongly believe that to advance we need to produce high value-added process products for specific market niches. To achieve this we need a major expansion of the population of creative food firms producing quality products for carefully researched markets both at home and abroad, but particularly abroad.

The pilot task given to SFADCo is to find the ways to achieve this goal. I should emphasise, however, my own belief in the dramatic potential which this sector has and my own impatience to see greater results. I am currently having discussions with the company to see how these greater results can be achieved through an intensification of SFADCo's present activities.

Another major development affecting SFADCo in recent times has been the exhaustive scrutiny of their affairs by the Dáil Committee on Public Expenditure which culminated in the recent comprehensive report on the company. The Dáil will, of course, have another opportunity to discuss the contents of that report in detail, but I would like to take this opportunity to make a few brief comments. First of all I think it appropriate to thank the members of the committee and indeed the staff of the company whose willing co-operation was acknowledged in the report for their efforts in producing an informative document on the company's affairs.

It is, of course, possible to take issue with some of the committee's specific recommendations but I feel this should only be done after mature reflection. What I think is relevant to our debate today is the primary conclusion that the company has been highly successful at its appointed tasks — in my view an accolade well deserved. Moreover, it is a success story that is recognised internationally. The Shannon free zone is the acknowledged prototype for similar developments elsewhere and the company's advice is eagerly sought by developing countries and by the major multilateral aid agencies. Indeed, so convinced are the committee of the validity of this conclusion that they feel the time has come to reorientate the company's work, in particular away from its traffic development and tourism roles.

I want to state that I have no intention of recommending to the Government the committee's suggestion that the company's traffic development function would be assigned to Aer Rianta or to anybody else. I feel in any event that this misapprehends the essential nature of the company, whose primary role is in fact to ensure the maintenance and development of the airport. The fact that it has successfully taken on additional industrial development functions must be seen in this context, and it is important to emphasise, as I have already pointed out, that statutorily the company only acts on behalf of the IDA in the small indigenous industry sector.

Possibly more important, certainly in the short term, in commenting on the suggestion that SFADCo's traffic development role be reassigned is the impact which recent international events have had on American foreign travel. Any decline in such traffic will obviously have a significant impact on an airport which is dependent for more than 50 per cent of its terminal traffic on North Atlantic travel and I think Shannon would suffer badly if SFADCo were not able to assist with the type of work which has been decisions by Pan American Airways and Delta Airlines to begin scheduled service into Shannon from the US in 1986. Indeed, it is to be hoped that these developments will help to insulate Shannon from the worst of the downturn being felt by European countries in this respect.

In commenting on this overall conclusion of the report, I must emphasise that I personally endorse the long established national policy, confirmed by successive Governments, that Shannon be developed as the national transatlantic airport, and that SFADCo have responsibility as the primary body for implementing that policy. That responsibility involves developing trade, passenger and services activities in the Shannon region and incorporates by definition such diverse functions as tourism, working with airlines, promotion of business conferences, urban development and industrial use of the airport.

In questioning the validity of SFADCo's involvement in some of these areas, the report is ignoring the major national benefits that have accrued from the company's ability to pioneer new developments, going as far back as the early sixties. Examples are the concept of the industrial estates, advance factories, industrial training, charter programmes, specific projects like the historic castles, and the first package holidays into Ireland.

Precisely because of its multi-functional role, Shannon Development is greater than the sum of its parts. It brings industry, aviation, tourism and other aspects of development together under one co-ordinated programme, adding a new dimension to the development process which encourages enterprise and innovation. Indeed, the benefits resulting from this were acknowledged in most positive terms in the OECD report "Innovation in Irish Industry".

Reference to positive remarks about SFADCo's role in innovation reminds me to welcome the positive conclusion reached by the committee in relation to the activities of the Innovation Centre and the Micro-electronics Applications Centre. This conclusion accords with my own view and that of my Department. As the report of the Committee outlines, certain structured changes have recently been made in the Micro-electronics Applications Centre with the objective of making it financially self-supporting by 1987. I am hopeful that this objective can be realised. The innovation centre is currently examining its future structure and funding and full account will be taken of the committee's recommendations in this examination.

Much of what I have been saying is sufficient justification for advocating the increases in financial limits being provided for in this legislation. This Bill is, in any event, merely an enabling measure which increases the funds which the Dáil may annually provide to the company, and Deputies would obviously have other opportunities in the context of Estimates debates to examine any activities of the company which they feel may not be producing worthwhile results. I would further emphasise that Shannon Development is but one element of an industrial policy which was the subject of thorough and lengthy reviews by both Telesis and the National Economic and Social Council, leading to adoption of the White Paper to which I have already referred. Not only did this overall review accept the validity of SFADCo's continued existence, it resulted as I have explained, in SFADCo's role in the food area being extended. Given that we have the good fortune to be discussing this matter so soon after the Public Expenditure committee have also carried out a very specific review of the company's affairs and endorsed its overall results, I have no hesitation in commending this Bill to the House.

Mr. Lyons

I welcome this Bill to increase the limits of the existing legislation in relation to the Shannon Free Airport Development Company area. It provides us with an opportunity to review the operations of the Shannon Development Company. Since their foundation in 1959, their contribution at regional and national level has been magnificent. The company's record is a glowing testimonial to enterprise and innovation in the State commercial sector. Indeed, their example is a shining one to both the public and the private sector. The last time similar legislation came up for review was in 1983 and the most notable feature of the 1983 amendment of the Bill was to give statutory authority to the company's activities in the small industries sector.

This opportunity to review the record of SFADCo is essentially welcomed in the light of the findings of the recent examination of the company carried out by the Oireachtas Committee on Public Expenditure. It was unfortunate that the publication of the committee's report, which had some useful things to say and which acknowledged the company's success in fulfilling the mandate given to them by Government, should have been marred by the accompanying highly selective press statement issued by the chairman of that committee. Why such a highly subjective interpretation of the company's position should have accompanied publication of the report of the Dáil committee is, to say the least, a mystery. Perhaps it may be attributed to the ideological inclinations, or perhaps the Pale mentality —and I do not mean pale in colour — of certain individuals. It was not representative of the report; neither was it representative of the views of the members of the committee. Sufficient to note that the statement was speedily and summarily dismissed by the Leader of the Fianna Fáil Party, Deputy Haughey.

The objective assessment of the past record of the Shannon Development Company is what we may view as their long term objective to serve Irish industrial needs. The Shannon Development Company's emphasis on quality and innovation since their inception in 1959 has ensured consistently high standards as they went about their appointed task of developing Shannon Airport with, as a corollary, the promotion of tourism and industry in the mid-west and, latterly, the development of small indigenous industries.

During the debate on the previous amendment of the Act in 1983, the Minister of State at the then Department of Industry and Energy, Deputy Collins, referred to the company's very broad and vital national task in relation to small industries. The company's mandate included "developing and testing concepts and systems which will lead to dramatic growth of small indigenous industries in those areas and to do so in a manner which would pioneer future national programmes." This signalled the importance of SFADCo within the overall national industrial strategy.

The White Paper on Industrial Policy pointed out in paragraph 5.3.6. that one of the more successful aspects of our industrial policies during the seventies was the extent to which manufacturing industry had been dispersed throughout the country. It pledged that regional development will continue to be an important factor in our industrial development policies. The same White Paper gave SFADCo a central role in its strategy to develop small industries and the food processing sector. The recent opening of the SFADCo food processing centre in Limerick will encourage entrepreneurs in the food sector and new produce developers.

All of us in this House give every support to the centre in its test initiatives and programmes to devise market oriented consumer food products so that they can be brought to a viable commercial stage and applied on a national basis. The greatest possible need for import substitution is in the food processing sector. Exports are the life blood of our island country. Meeting the exacting standards of continental and world consumer markets and supplying them with quality goods is how we will achieve more jobs and higher living standards. At present we export a large percentage of our farm products. We desperately need to move away from commodity type production and into new consumer products for which there is a demand on the international markets. Concentrated development and integration of our considerable resources in the food sector is, therefore, a key component of the IDA strategy to double industrial output over the next decade. The pilot projects undertaken by Shannon Development Company are central to the challenge of achieving the full potential of the Irish agri-food sector.

The White Paper on Industrial Policy notes in paragraph 7 that SFADCo's pilot project on food product development will be conducted in co-operation with the NDC in devising a framework for long term supply contracts between farmers and processors. I should like the Minister to outline what progress, if any, has been made in drawing up guidelines to achieve this level of co-operation between SFADCo and the NDC in the food processing area. In 1978 SFADCo were given a special role in the intensive promotion and development of small industrial industries in the mid-west. Since then, a number of initiatives have been successfully tested by them and are now being applied nationally by the IDA.

It is generally acknowledged that SFADCo have played a significant role in the IDA's small industries programme, have responsibility for the promotion of small industry in the mid-west and in west and south Offaly. They will be required to intensify their efforts in this area as we seek to build up and expand the small industries sector in pursuit of increased output and jobs. At present small enterprises employing fewer than 50 people represent 80 per cent of native Irish manufacturing companies. It will be necessary to expand our efforts in this area to create new export orientated companies and to facilitate expansion in existing small firms. SFADCo have a central role in encouraging the development of firms with a strong commitment to product development and marketing. I am quite confident that they will meet this challenge with the same flair and expertise which has characterised their success in so many areas of endeavour.

The Oireachtas committee noted that the work of SFADCo had been internationally acknowledged as highly successful and presenting a useful development agency model. Like the Minister, I want to reiterate that the introduction of this Bill to the House and the report of the committee are indeed very timely because it affords us all an opportunity to broaden the scope of the Bill and to include references to the report as we see fit.

The success of SFADCo is due partly to the open, brief and comprehensive range of authorities assigned to SFADCo but more especially the innovative and enterprising approach pursued by their staff. Among the commercial sector SFADCo stand out as a source of dynamism and innovation. Their significance for the development of the mid-west cannot be under estimated. The board's planning capacity and management have been proven as they consistently fulfilled their mandate. Their freedom of manoeuvre in pursuit of their objectives and their freedom to act without excessive Government interference and control must be a factor in the success of the Shannon development.

The review of the Oireachtas Committe on Public Expenditure questions whether the benefits of the company's small industry role should continue to be felt mainly in a comparatively well-developed region like the mid-west. My response to that must be that for some time the company's small industry role has implications for industrial development on a nationwide basis. In assigning responsibility for small native industry to SFADCo in 1978 the Government specifically directed that the company would adopt an intensive and innovative development approach. In pursuit of this objective the company have become involved in activities which are not exclusively concerned with small industry and which have a national rather that a purely regional significance, such as the establishment of the innovation centre and the national micro-electronics application centre.

Small industry in Ireland is hampered from reaching its full potential by many difficulties such as marketing deficiencies, management weakness, the high cost of research and development and the extraordinary high costs associated with manufacturing industry which are detrimental to expansion and the sort of promotion we need in manufacturing industry to create the jobs that are so badly needed at present. The costs of maintaining employment and of keeping industry going are bearing too severely at present to have the overall effect that all of us wish — to provide jobs for more people. Indigenous industry needs to become internationally competitive if it is to reverse the trend whereby competing imports now account for nearly 40 per cent of the Irish market compared with 20 per cent a decade ago: likewise, if the majority of Irish firms are to diversify their exports away from traditional markets and towards new markets.

The White Paper on Industrial Policy warned that:

At present there are very few small firms which can consistently meet the quality standards laid down by large firms.

Therefore, if that is the belief of the Government, and it obviously is in this instance, the tremendous potential for increased output and employment through Irish industry supplying large projects remains untapped. This is something to which we will have to address ourselves if we are to have an expansion of our industrial base. Small Irish companies must continue to receive the backup from State agencies such as SFADCo in developing the technical know-how to produce high technical components and in producing high quality products both domestically and internationally.

The Government's national linkage programme depends on upgrading the quality and reliability of the products of small firms. In this process the Shannon Free Airport Development Company will have an increasingly important role. The Oireachtas Committee on Public Expenditure states:

For historical reasons, amongst others, SFADCo has been able to adopt a fairly liberal interpretation of industrial and tourism promotion. This had led it into urban development and re-development and industrial training and promotion of higher education facilities and science and technology. SFADCo has been responsive to needs and innovative as it was required to be in the promotion of small indigenous industry.

The report also acknowledges that questions about the company's role and performance in the future have arisen in part from the company's success in promoting development in the mid-west. Thousands of jobs have been created in the Shannon free zone and countless thousands in the mid-west and beyond in tourism and industry.

I concur with the Minister when he indicated in his opening address that despite the trends and the difficulties that many regions have encountered, we in the south west were the first to encounter those difficulties. Now, those difficulties have spread to the remainder of the country, as I outlined recently. Nevertheless, at least the mid-west held its own. In fact the number of jobs in that area increased while the other regions were suffering the loss of jobs to the greatest extent that was ever experienced in Ireland.

I wholeheartedly endorse the Oireachtas committee's view that with emphasis on small industry in industrial promotion policy, SFADCo are ideally poised to pilot new approaches to industrial promotion and development with a view to providing the model for other regional development agencies in time. The committee suggest that it is on this basis that SFADCo's mandate be redefined and some of their functions, staff and assets re-assigned as appropriate. That reference and some of the other references to SFADCo in their report were outside their terms of reference. It has been suggested that SFADCo's promotional responsibility for the future development of Shannon Airport should be ended and this function extended to Aer Rianta. I want a categorical assurance that there is no proposal to do so. I acknowledge the Minister's statement that he has no intention of recommending such a change to the Government or anybody else. It is well to have the Minister make that point. I want it said as often as is necessary to make it sink into the minds of those people who are thinking of breaking up a successful operation such as SFADCo as indicated in the report from the committee.

Air traffic in passengers and cargo handling is projected to increase considerably worldwide over the next few decades. The experience and expertise built up by the company in the past 27 years must be availed of. The company must be allowed to continue their three main functions: traffic through Shannon, industrial development at Shannon and the development of small industries in the region. They are the three basic aims of the Shannon Free Airport Development Company. During the course of a similar debate in 1983 my colleague, Deputy Reynolds, referred to SFADCo's success in generating extra traffic through Shannon during an extremely difficult period in the aviation business and its spinoff effects in economic terms in the region. The committee's assessment of the company's promotion of tourism/traffic suggests that their outlays on promotion do earn a return for the national economy by extending the average length of stay.

As the report suggests, there is scope for streamlining the promotional and marketing activities of SFADCo, Aer Rianta and Bord Fáilte. This has long been my party's approach to the development of tourism marketing as expounded recently by my colleague, Deputy Flynn. We see merit, therefore, in the company's recommendation that a formal agreement be devised with Bord Fáilte for the promotion of tourism in the mid-west. However, the importance of the Shannon Development Company in the economic life of the mid-west and their potential to spearhead regional development in the disadvantaged regions remain linked to the airport, a vital element in the infrastructure of that region. Therefore, I am not convinced that the Shannon Development Company should relinquish their mandate to develop traffic at Shannon and, as the Minister said in his speech, give it to Aer Rianta or anybody else. I concur with the Minister on that.

I keep referring to the committee's report, the isolated outbursts and so forth. The timing of the introduction of this Bill gives us an opportunity to reflect both on the report and the proposal in the Bill. As the Minister has said, and I fully agree with him, this is enabling legislation. The committee's report notes the close inter-relationships which exist between SFADCo and Aer Rianta. This being the case, it should be possible for the two bodies to devise the necessary steps to eliminate any duplication and to provide cost effectiveness in the promotion of air traffic by the two bodies at Shannon without a drastic change in the position of the Shannon Development Company vis-á-vis the airport development.

I fully support the intention of the Bill which is principally to raise the financial facility of taking up shares in the company from the present level of £120 million to £130 million and also the grant-in-aid, which partly pays for the company's administration costs and pays entirely for the grants to industry within the Shannon free zone, from the present level of £60 million to £105 million. I accept that the cost of grants to small industries administered by SFADCo in the mid-west region outside the Shannon free zone is borne by the IDA. When we come to Committee Stage we will have a discussion on section 4.

Mr. Carey

I also support the Shannon Free Airport Development Company Limited (Amendment) Bill, 1986, and I agree with Deputy Lyons that the introduction of this Bill is timely, especially in view of the bad press which followed the report of the Committee on Public Expenditure on the activities of the Shannon Free Airport Development Company Limited. Since their inception, this company have proved to be of great benefit to the economies of Clare and Limerick in particular. The company highlighted the major advantages to industrial companies who availed of them. They came into the area. There developed a syndrome of jealously in other areas. In particular, this emanated from the Southern Republic, Cork, where they said that the mid-west region was getting too much largesse from the national coffers.

For years we looked at the way in which the former Taoiseach, Jack Lynch, brought all the new companies down to Cork and built up a major infrastructure there. Cork people did not mind the major industries which they had. When Fords started to crumble when the change was there after our entry into the EC, what did Cork people do? They let them go out of the window. Cork Deputies have come into this House continuously and moaned and groaned and cried about the position of industry in Cork. The IDA are now once more ploughing most of their funds into the Cork region. Yet, we still have Cork Deputies coming into this House and crying about disproportion. What I abhor most of all about the report on the Shannon Free Airport Development Company is the bias which it contains. Membership of the committee included only one mid-west Deputy, Deputy O'Kennedy. I would not blame the former Minister for Finance if he had to give way to this totally eastern bias which was evident in the report. I accept that this report is not part of this Bill. Therefore, I will get away from it.

The Minister referred to the report in his Second Stage speech. As a Clareman, I would like to acknowledge the role the development company have played in my county since their establishment. I will give the development company credit for this: they stood up and were counted. One thing which made them hated figures to a certain extent in some parts of the country and in my own county was that they resisted political patronage. No Minister for Industry and Commerce could use that company as a whipping boy. I will say this much, they were independent. Their role has changed. Perhaps they have now adopted a different attitude. Indeed economics demand that such changes be effected. In fairness the Committee on Public Expenditure are entitled to criticise but, as the Minister has said, there were complementary roles laid down for the development company, to develop airport traffic, in conjunction with Aer Rianta.

I have a feeling that there has developed a rift between the Aer Rianta management and that of the Shannon Free Airport Development Company. I might wish Mr. Tom Dunne well in his new role. Now that the team has been shuffled somewhat the new era and opportunities presented to the management of the development company should be grasped. I know they have the requisite ability to respond to change. I was concerned about the matter recently myself. I contacted Deputies in the mid-west region, the management of the development company and Aer Rianta with a view to devising some type of united approach for the promotion of Shannon. It should be remembered that the Shannon Free Airport Development Company were responsible for the creation of a new town with a population of 8,000. There are now more young people, proportionately, in the town of Shannon than there are in any other part of the west, or south, perhaps with the exception of the town of Tallaght. There is, therefore, a grave responsibility on the development company to be aware of the needs of that community alone on which half of the county of Clare and the town of Limerick are dependent. I know that the new management team will fully examine their roles, especially since they are being afforded the opportunity — by way of introduction of this Bill — to increase from £120 million to £130 million the aggregate amounts which the Minister for Finance may subscribe in taking up shares in the company and an increase from £60 million to £105 million in the aggregate amount of grant-in-aid voted annually which may be made to the company. There is a particular need for the company to concentrate on the promotion of the industrial estate there.

I was glad to note recently that the Minister for Industry and Commerce had opened a new factory in Shannon. I know there has been much growth in the high technology area. I must compliment the outgoing management team, in particular Mr. Paul Quigley, for having placed emphasis on the value of education, on the way he encouraged the establishment of the third level institute, NIHE in Limerick. He organised superb people to run the institute and acknowledged the value of their work by attracting high technological industries into the industrial estate at Shannon.

It should be remembered that the Shannon Free Airport Development Company have a social role to play. Indeed, in fulfilling that social role, they brought a new town into being. The report of the Committee on Public Expenditure and the industrial policy enunciated by the Minister's predecessor clearly expected Clare County Council to take over this supervisory or developmental role undertaken by the company over a long period. I would appeal that the progress be slow in this direction. Apart from its effect on the development company itself, I do not know that the inhabitants of the town are ready for this change. I know that some progress has been made in talks between the Department of the Environment, the Shannon Free Airport Development Company and Clare County Council. The community would need to give this proposal wholehearted approval before finalisation.

I am happy that I have spoken on behalf of the people of Clare and indeed the management of the development company. I thank the Minister for his interest in the area and on the manner in which he expedited introduction of this Bill which I support fully.

Mr. Daly

The Bill before the House affords Members an opportunity to comment on the Shannon Free Airport Development Company and their activities in the mid-west region. I might pay tribute to their outgoing general manager, Mr. Paul Quigley, a man of ability and integrity, who played a major role in the overall development of the mid-west region at a time of rapid change in industrial development internationally. Within his term of office he brought about a dismantling of the protectionism that had existed so that there was almost total free trading and that was in a time of crisis and recession. Indeed the best tribute one can pay him is to have regard to the now thriving development company and industry throughout the mid-west region. Many of the difficulties experienced by other parts of the country during times of economic recession, depression, oil crises and so on have been minimised by the efforts of the development company in that region. That is a tribute to the company, to the dedication and commitment of their personnel. I might also congratulate Mr. Tom Dunne on his appointment as general manager of the company. He is a man of ability, a dynamic executive, with wide experience in industrial development who has been involved in the company for quite a while. He is keenly aware of the difficulties of attracting industry to the region. He fully understands the enormous problems of the region and also the opportunities obtaining there. I have no doubt that, under his leadership, the company will go from strength to strength. I wish him well in his new post and also all of the personnel of the company in their endeavours which become daily more difficult.

We are aware that the company have experienced outstanding success in a number of areas. I am doubtful that the provisions of the Bill will adequately meet the changing circumstances of industry at present. Indeed it is a more two and a half years since similar legislation was before this House. Would it not be more appropriate for the Minister to introduce legislation covering a period of, say, five years in order to enable the company to develop in a planned, proper way? I believe that the amounts provided under the provisions of this Bill will not be adequate to meet the challenges facing the region in ensuing years. I do not think it desirable that we should have to come back to this House almost every consecutive year seeking authority to increase the amounts payable by the Exchequer to companies like these. I believe it is bad for the semi-State agencies and for the Oireachtas. If we are to give them the necessary support to undertake the work that needs to be done in the mid-west region, they need to be able to plan much further ahead than, say, one, two or three years.

Section 4 is objectionable. Hopefully on Committee Stage we will have an opportunity to deal with it. We have seen in a number of measures which have come before the House provision being made to take over the management of staff in various companies. Here we are dealing with two Ministers, the Minister for Industry and Commerce and the Minister for the Public Service. I am concerned that a trend might be developing in legislation like this for the Minister for the Public Service to control personnel in companies like the Shannon Development Company. This might inhibit the company from attracting people of a sufficiently high calibre into the company. Such people are badly needed in industry. If we have restrictive pay and conditions of employment it will not be helpful in attracting this type of person. I do not see that it is necessary to have section 4 at all and perhaps the Minister might deal with this point.

We have had very sophisticated and highly successful industrial projects established in the estate over the past number of years. We have internationally recognised companies such as Lana-Knit and SPS dealing with hard metals and in 1985 De Beers industrial diamonds celebrated their 25th year in the estate. We have seen multinational companies replace foreign personnel with Irish trained personnel and this development is to be welcomed. In Westinghouse a direct policy commitment was given by the company management to replace their American personnel with suitably qualified Irish staff at the first available opportunity. This development should be encouraged in industry generally where multinational and international companies are concerned. We have many highly qualified young people who would be well able to take over the management of such companies but regrettably many of them are forced to seek employment abroad.

The Shannon Development Company have undertaken to research agri-business pilot programmes. There is great potential for development in this area. The company have already carried out research into mariculture. Along the Shannon estuary sites have been identified which are suitable for the development of fish farming We could substitute home produced fish products for imports. Little has been done in this whole area in the past few years. The Shannon Development Company, through one of the schemes they operate with the Youth Employment Agency, have organised with the help of local farmers and business people a co-operative to farm fish at Carrigaholt in west Clare. This is an important development. The experience gained there can be used in coastal communities to encourage people to invest in these projects. There are many job possibilities in this area.

The Company recognise the difficulties that exist in attracting industry to remote rural areas where there is a lack of infrastructure, telecommunications and so on. We will have to exploit our own natural resources in coastal areas. That is the only way in which jobs will be provided which, in turn, will mean extra revenue for the State. If we develop our own fish farming it will cut down on fish importation. We must do it for ourselves. As we said in the debate on the Fisheries Estimate, it is completely insane to allow the Norwegians, Dutch, Danes and Spanish to come in and do what we could do for ourselves. I support the development company and the Youth Employment Agency in their efforts to encourage local enterprise to become involved in the training of local people and to use local resources such as they have done in Carrigaholt. There is no hope of attracting any industrial project to this area without involving an enormous cost to the State.

All that is needed in coastal areas is for people to become involved in pilot projects and to undertake the research and development work. Companies like the Shannon Development Company could become involved in the management and secretarial end. A number of projects could be organised along the Shannon estuary, but to date this has not been done.

The Shannon estuary has been debated here on many occasions but it remains underdeveloped. I accept that a few major projects are in operation but little has been done to attract more industries. The Harbours Bill which was introduced in the Seanad is totally inadequate and has been rejected by all County Clare public representatives. The Bill to develop the Shannon estuary is not expected to be of much benefit to the area and we must look at SFADCo to get involved in the promotion and development of suitable sites for all types of industries. The potential exists along the estuary. When the Moneypoint station is in operation there will be potential for fish farming, vegetable growing and co-operatives. We should ask SDAFCo to move into the area and develop sites for industrial projects.

I do not think there is one industrial site on the Clare side of the Shannon estuary, from Loop Head to Limerick City, that is owned by SFADCo or the IDA. Many reports on the region have highlighted the potential of the estuary but little has been done about developing the area. If an industrial concern expresses an interest in establishing an industry on the Clare side of the Shannon estuary we will not be able to offer them a suitable site. Many companies are considering the Shannon estuary as a location for an industry but we do not have suitable sites. Unlimited possibilities for the trans-shipment of coal from the site adjacent to the Moneypoint station exist. Many international companies have expressed an interest in trans-shipping from that area. The ESB have sought planning permission from Clare County Council to transport coal from the site to other locations in the State. However, a site suitable for any international company has not been purchased or earmarked. I hope the development company will pay attention to that matter in the coming years. If we are waiting for the Harbours Bill to do anything in that regard we will be waiting for another ten or 20 years.

Shannon has been promoted by the development company as an ideal location for international services. Shannon should also be identified as an area for the decentralisation of Government offices. Under a former Fianna Fáil Government an environment section of a Department was transferred to Shannon and that proved very successful. Shannon is an ideal location for further decentralisation. Some years ago the development company submitted a request for the decentralisation of Government Departments but, unfortunately, the decentralisation programme was scrapped by the Coalition. We now have the same old story of all services being located in Dublin. Dublin is top heavy and cannot cater for any further development of this nature. Areas like Shannon should be used as a location for a Government Department.

I note that the 1985 report of the Shannon Free Airport Development Company states that ten small factory units were built in that year. There is concern that a number of such units, at Kilmihil, Kildysart, Ennistymon, Miltown Malbay and Kilrush, are unoccupied but there is a need for more factory bays. For example, Ennis Urban District Council have requested that a number of units should be provided at the local industrial estate. Most of the units there have been filled and it is necessary to erect further units there to attract industries to the estate.

It is interesting to note that 86 per cent of the factory buildings allocated are occupied. A small number of units are available for occupation by new industrialists. I should like to urge the Government, and the development company, to continue to build advance factories, particularly in towns like Ennis. There is a need for further expansion at Smithstown Industrial Estate. The small industries programme has been very successful in that estate and almost all the units there are occupied. The Minister should press ahead with the small industry building programme so that we will have factory space available for interested industrialists.

It is generally recognised that the international recession is lifting and there are encouraging signs in Europe that an upturn is about to take place. It is desirable that we should have sufficient vacant factory space to avail of any upturn in the economy. There is an urgent need to develop small industries to link up with bigger concerns. In the 1985 report the development company indicated that more than £3 million worth of business was generated by import substitutions in 28 small concerns in the Shannon region. Those companies manufactured small component parts for local industries. The match-maker scheme operated by the development company has had unique success in this regard. When the GAC company closed more than 200 people were made redundant and in Smithstown, and other areas of County Clare, a further 200 people lost their jobs. Those people were employed by companies who were supplying component parts to that bus building plant but, unfortunately, the Government allowed the GAC plant to close. We saw there the impact such a closure can have on smaller industries in an area. The whole thing is very depressing and I am asking the Minister to make some effort to get the bus building plant re-opened. We are all aware of the need for school, rural and city buses; and this year we will be importing about 25 buses which could have been built at Shannon if there had been any initiative by the Government. Their inaction is tragic and I hope that at this late stage they will salvage the bus company.

When the Burlington textile factory in Clonlara closed down hundreds of highly skilled people were let go, but there has been no effort to re-open the plant. We know that because of its nature the textile industry has been receiving EC aid in Britain and Northern Ireland. Why cannot we get it for industries such as Burlington, instead of allowing them to close down? We have heard the story that because of their policy on textiles the EC have not been grant aiding companies in that business. We are told there is over capacity in that industry. Why are we different from Britain? I hope the Minister will tell us what efforts he is making to get the Clonlara plant re-opened.

We welcome the initiative by SFADCo to spread industries throughout County Clare. We saw industries established in Ennistymon, Scarriff and Tuamgraney, but we are not satisfied that west Clare is being developed properly. I ask SFADCo to pay special attention to the critical unemployment level in Kilrush and I direct the Minister's attention to the vacant factory space in the town. There is a sizeable factory bay there which has been almost totally unoccupied except for an AnCO training course. A number of units could be opened up there, particularly aimed at fish processing in connection with mariculture and aquaculture production in the Shannon Estuary.

Some companies were interested in getting projects going at Cappagh. I am thinking in particular of the vacant old ceramic unit there. All these vacant units could be developed and supplied by some of the fishing co-operatives which have been established along the estuary. There was an excellent timber plant in Kilrush but because of Government inactivity — they did not provide the necessary raw materials for wood processing — the factory was closed down. A number of meetings were held and some representatives from the Department of Fisheries and Forestry visited the area and discussed it with local people. Now the workers are redundant. They have joined the dole queue——

Mrs. Taylor-Quinn

On a point of order, the Deputy is misrepresenting the position.

Acting Chairman (Mr. Barrett,

Dublin North-West): That is not a point of order.

Mrs. Taylor-Quinn

I would ask him to withdraw his statement.

Mr. Daly

This is an embarrassment for the Deputy.

Mrs. Taylor-Quinn

Would the Deputy tell the truth? An offer was made but not accepted.

Mr. Daly

People have been employed in that small timber mill in Kilrush which was in operation for between 40 and 100 years. It was a successful small business and it was the duty of the Government to see that it was provided with raw materials. At one time they were in difficulties but the factory was re-opened and it became a fine little industry, but then this Government allowed it to be closed down.

Mrs. Taylor-Quinn

That is untrue. An offer was made but was not taken up.

Mr. Daly

The factory has been closed and the workers have been let go because of inactivity by the Government.

Mrs. Taylor-Quinn

That is a lie.

Mr. Daly

The factory might still be closed in Scarriff because the Government closed it down and the Minister for Fisheries and Forestry did nothing to help. It is now open thanks to a Spanish firm of wood processors who came in to develop our timber resources which we could not do ourselves. The Government allowed the Spaniards to exploit our fisheries and now we have the Spaniards exploiting our timber resources, but to good effect. The Minister is walking away from this because he knows the Government did nothing to protect our timber industry. Good luck to the Spaniards and I hope they will be successful where the Irish Government failed so miserably in Kilrush and elsewhere. The picture of Government in action in relation to industry throughout County Clare has been a disaster. That is why Deputy Taylor-Quinn is so embarrassed today. She and all of the people of County Clare know the record of the Government in that county. They are waiting for an election and then the Deputy will have to answer questions on platforms at Scarriff, Kilrush and many other places in Clare——

Acting Chairman

Will the Deputy please get back to the Bill?

Mr. Daly

I am afraid I am embarrassing the Deputy opposite.

Mrs. Taylor-Quinn

The Deputy is suffering from hallucinations.

Mr. Daly

The record of her Government in relation to the development of industry in the mid-west region has been a total disaster and Deputies opposite know that quite well. Were it not for the strenuous work of the development company things would be much worse.

I should like to compliment the development company on the work they are doing. They should be encouraged to continue with the work and to press ahead with the development of our own natural resources. I welcome the attention they are now giving to the agri-business, to food products and to the mariculture area generally. That must be encouraged. If we are to succeed we will have to start with our natural resources which are abundant in the region and which have not been exploited to the full.

I should like also to compliment the development company on their work in respect of the development of Shannon town. I know the Government have made a decision to transfer the town management functions to Clare County Council. It is well known that every local authority are at their wits' end to manage their affairs and we do not want to see anything happening in Shannon town that will downgrade the services they have at the moment. If Clare County Council are to be given the function of managing Shannon town, they should be compensated in a way that will ensure no downgrading of services in Shannon. It is essential in the transfer of functions to Clare County Council that financial provision be made to enable the council to keep up the standards set by the company in Shannon.

There have been a number of very important developments in the area. It is important to note that home ownership in Shannon town is 60 per cent. This has been achieved because of the progressive policies in operation by the company to enable people in the industrial estate and in the town to buy their own homes. That ideal development must be welcomed. I hope in any change-over with regard to management functions that care be taken to maintain that development to encourage people to purchase their own homes.

Overall, this legislation is welcome even though there are some points in the Bill we shall have to discuss on Committee Stage. We wish to give every encouragement to the development company to press ahead with the overall development of the mid-west region. We want more expansion in tourism and in the various amenities the company are providing and we want further extensions of the industrial base to other parts of the county. We want more advance factories to be built where there is need for them so that there will be progressive development of the region in the next few years under a dynamic development company.

Mr. O'Malley

I am glad to have the opportunity to say a few words on this Bill in relation to the Shannon Free Airport Development Company. It is interesting to look at the report for 1985 which became available in the past few days and to see that the bulk of the activities and expenditure of the company seem to relate to the development of small indigenous industry. This time eight years ago that was a matter in which they were not involved. They have been very successful in what they have done in that regard in those eight years. It has benefited the mid-western region considerably but it has also been beneficial for the country as a whole because much development in respect of small industry that has taken place would not have occurred but for the steps taken in 1978.

I found it encouraging to hear the support voiced on all sides today for this area of activity of the company. When I made that suggestion to the company in 1977-78, there was much opposition to the proposal. I was told it was a foolish move and that it would not be of any value to the region or to the country. I am glad to see that has proved entirely wrong.

The value of a regional development company such as SFADCo lies to a great extent in their ability to meet changing circumstances and to adapt to those circumstances and needs. They have done this in the area to which I have referred. The importance of that is understood by the company and the first sentence of the chairman's introduction to the annual report for 1985 underlines that concept. He said:

In an environment of accelerated structural technological and market change and slower worldwide growth, a country and its individual enterprises must change faster and more effectively than the world around it if they are to survive and prosper.

I know Mr. McCabe is a man who is well aware of the need for change and the need to respond to change. I often wish that those who talk about these matters were equally responsive to that need for change.

In terms of what the development company should do, a few years ago I suggested that by far the greatest potential for the mid-western region lay in the development of the Shannon estuary and as a clearly successful regional development organisation it seemed to me that SFADCo should become involved in the development of the estuary. I recognised at that time — and unfortunately the problem still remains — the big stumbling block to a company like SFADCo becoming involved in the promotion of the estuary was jurisdictional disputes between Departments. Because harbour matters were seen primarily as matters for the Department of Transport, as it then was, now the Department of Communications, everybody else had to keep off. We see these jurisdictional disputes arising quite frequently in terms of potential development. I regret very much that our public administration continues to be run in a way which allows worthwhile developments to be hindered simply because of jurisdictional disputes and because it would seem not to be appropriate to those concerned to have a regional development organisation, such as Shannon Development, involved in the promotion of something which primarily has to do with harbours. We have to get over that sort of thinking. It is not reflected in many other countries. If some place like the Shannon estuary were identified in another country as being a place of great potential development, all the stops would be pulled out and there would be no question of jurisdictional disputes, or which Department were supposed to deal with it. The best people and the best organisations would be put to work to develop it. That is what should happen here.

In the Bill produced in the Seanad within the last month on the Shannon estuary, it was disappointing to note that it simply envisages a bigger harbour authority rather than something innovative which would lead to the proper development of the estuary with great benefits to the region and to the country as a whole.

In my fairly considerable experience of them, I have always found the Shannon Development Company prepared to respond to change and to need as far as they could, but they are hidebound by legislation and by the sort of difficulties I have been describing. It is appropriate to mention at a time like this the retirement of two of the major people associated with Shannon Development over the years, Dr. Brendan O'Regan retired last year. For many years he was chairman of the company and made a contribution to the development of Shannon and the region which will never be parallelled. Mr. Paul Quigley, the general manager, retired within the last month after serving a very successful term of office during which he carried out his duties with great thoroughness, dedication and commitment. I wish him well in his well deserved retirement. I have no doubt that his successor, Mr. Tom Dunne, is a man of equal qualities and I think the company are fortunate that someone as able as he was appointed to that position.

I want briefly to refer to the question of traffic development at Shannon an area in which the company are involved to a considerable extent. It has been my experience that one of the great difficulties Shannon has in relation to traffic development is the lack of connections between Shannon and Britain and Shannon and continential Europe. As is shown by the annual report, the amount of traffic between Shannon and continental Europe is a very small proportion of the overall traffic and, as far as I know, is entirely represented by charter traffic, and none by scheduled traffic. The amount of traffic to Britain is much smaller than need be. That is caused by the fact that for the best part of the year there are only two flights a day each way. They both leave around mid-day, within an hour of one another, and they both arrive within one hour of each. This service is provided by airlines which are in a cartel on the Irish Sea. They both charge exactly the same fares and decline to compete with each other. They provide the connection between Shannon and London at the most inconvenient and useless time of day — the middle of the day — and they have consistently declined to provide access to Britain in the morning, returning in the evening.

I hope that as a result of the recent nouvelles frontieres case at the European Court of Justice in Luxembourg these cartels will be broken, that competition will be introduced, that normal competition rules under the Treaty of Rome will have to apply, that we will get a more satisfactory service at Shannon and that this disgraceful cartel arrangement will be brought to a speedy conclusion. It is obvious that further carriers should be licensed if the existing cartel carriers are not prepared to provide a proper service. I understand that at least two Irish companies have applied for licences for flights between Shannon and London. I suggest that they be granted at the earliest possible time and not be delayed or ignored as has been the practice of the Department of Communications for so long.

The potential for flights between Shannon and continental Europe is very considerable. There are airlines which are prepared to provide those services at a reasonable level if they are allowed to do so. I remember some years ago when unfortunately a service between Shannon and Amsterdam was closed by the Department because the airline concerned was not prepared to charge a high enough fare. The potential traffic which would have been generated into Shannon and into the region was lost as a result. That was taken as normal and very little protest was made by anyone, except possibly myself.

It is worth emphasising the difficulties that exist in terms of communications between Shannon and Britain and Shannon and continental Europe if one was to contrast them with the situation that happily exists today on the Atlantic as a result of competition. We have four scheduled carriers flying from the United States to Shannon this summer, something we never had before but which I heartily welcome. It is noticeable that this competition has grown in an area where there has been deregulation of the old IATA type restrictions on airline services. Hopefully this development will come about in Europe as a result of court cases and changing views of Governments. It is very disappointing that we have to wait years for obvious things to happen, things which should happen without any delay.

The most important potential and development hopefully which will take place in Shannon in the next six to nine months is the proposal by Guinness Peat Aviation to join with others in providing a transatlantic package service from Shannon throughout Europe. If this comes about it will be one of the most beneficial developments that have ever taken place in Shannon, ideally suited to the airport and to the region and it will bring a tremendous amount of employment in its train. I urge the development company to continue to do all they can to facilitate this operation. Of course, Shannon will have a great deal of competition both in Britain and on the Continent for such development. Unfortunately, Shannon has already lost the first such development to Brussels, but if what Guinness Peat Aviation and their partners have in mind comes about, it will be the largest and most succesful operation of its kind in the decades to come.

It is worth noting that the most successful company this country has seen in the past ten or 15 years is the company based in Shannon. Guinness Peat Aviation have brought tremendous credit and tremendous economic benefit to this country, and Mr. Ryan and the others associated with the company deserve our admiration for the almost incredible success they have achieved based in Shannon over the past ten years.

Other companies of that kind in Shannon would be of tremendous assistance to the region and the country, and every effort should be made to encourage them whether they are Irish, as in the case of Guinness Peat Aviation, or foreign. It is disappointing to find that, for example, there are only two offshore insurance companies based in Shannon, only one of them of any size, when Shannon is an ideal location, geographically and in terms of the legislation available, for activities of that kind. It is very disappointing to find that there is no offshore banking in Shannon despite the development company's efforts over the years to encourage it. Again, the location is ideal. It is not at all the fault of the development company. They can do very little because they must promote Shannon within the overall climate in the country to date. You have only to look at the Finance Act 1986 and the ridiculous attitude taken in this country towards financial institutions, both banks and insurance companies, to realise why we have not been able to exploit the potential of Shannon in this regard.

Many hundreds if not thousands of people could be engaged in offshore financial services at Shannon because that pattern is developing in many areas which are less suitable and have fewer suitable people available than in Shannon. Very short term policy indeed is reflected in the Finance Act of this year which causes considerable loss of valuable and useful projects with very high grade, highly paid employment which we could have in Shannon but which we have not got as a result of the rather niggardly attitudes taken towards any organisation that can be described as a financial institution.

Let me say a brief word on urban renewal in Limerick city which the development company undertook at my suggestion some years ago. They encouraged private developers to restore 18th century buildings with great success architecturally and visually. Unfortunately, the commercial success has not been as great as one would have wished because the restoration of these buildings coincided with the downturn in the property market. Lest the development company and the developers concerned might feel that because some of the work done was not a great commercial success it should not be persisted in, I would like to say that we hope there will not always be a downturn in the property market and that the restoration work on many fine buildings which has been so successful at places like the Granary and Rutland Street in Limerick will continue to both the social and commercial benefit of the city. The development company have helped the Limerick Civic Trust significantly in the work they are doing and the people concerned are to be commended highly. If any city needs restoration it is Limerick which has some splendid old buildings of which, unfortunately, a large proportion has been allowed to go derelict over the years.

In conclusion let me say that SFADCo are an excellent prototype for a regional development company in this country or anywhere else. From fairly considerable experience with them I have found them open to suggestions. They work closely with the region and the communities in which they operate and they have invariably retained a very good relationship with a great majority of people with whom they come into contact. I am glad this Bill gives them money to continue their activities for another four years and I hope that, during the coming four years and the coming decades, SFADCo will be as successful and as useful to their region and to the country as they have been over the past 25 years.

Mrs. Taylor-Quinn

It is three years since a SFADCo Bill similar to the one presented before us today came before the House. I take the opportunity to welcome this Bill. Unlike many recent critics of SFADCo, I feel that they are doing an excellent job and any assistance this Government can give them to continue their development is very worth while. One must look at the wide and varied role that SFADCo adopted in the past. They have responsibility for Shannon town and all the services that go with it. They have responsibility for industrial development in the Shannon free zone and in 1978-79 they were given additional responsibility for small industrial development in the mid west region. They have responsibility for traffic development through Shannon.

Overall their portfolio is very wide. We will not find any other institution in the country carrying the same varied type of responsibilities. On examining what they have done in all these areas and recognising how successful they have been, one cannot but be supportive of the very fine work they have been doing in Shannon. Of course, such work cannot be done without a very expert team of people and I take this opportunity to compliment the board and management of SFADCo on the tremendous work they have done in County Clare and for the mid-west region. I compliment Frank McCabe who has been chairman of the board for a considerable number of years.

In particular I compliment Paul Quigley who retired recently from SFADCo. He worked there for many years and had a clear innovative mind which he was prepared to adapt to changing circumstances. With him at the helm and with the very fine team of managers who worked with him, there has been a very successful outcome at Shannon and the region generally. As a public representative dealing with Mr. Quigley in recent years, I always found him extremely helpful, efficient, co-operative and businesslike. Many people in similar positions throughout the country could take a leaf from his book.

SFADCo in the future will have to adapt to changing times. Negotiations are in progress for Clare County Council to take over the housing estate and the services that go with it in Shannon. If that happens it will be a major change but, before Clare County Council take on the additional responsibility of Shannon town, the whole situation should be thoroughly examined to ensure that Shannon town continues to have the services which are provided by SFADCo at present and indeed are substantially improved on. There is room for very serious negotiation between the Department of Industry and Commerce and the Department of the Environment on this matter in conjunction with the management of the two bodies concerned.

In relation to small industries development, Deputy Daly and other Opposition speakers should look at the figures and the success rate of that venture in recent years. In 1978, when the small industries scheme was started, there were 350 small industry firms in the region employing about 3,000 people. Today there are over 700 firms employing 5,300 people, a very substantial increase. When one takes this into consideration, in view of the national trend in relation to employment in the manufacturing area, it is obvious that the scheme is very successful. Indeed, since 1983, there has been an increase in jobs in the region of over 400, again a substantial number given the national trend, and one which all politicians should recognise. Of course there have been job losses in the mid-west but, despite that, SFADCo have managed not alone to maintain the 1983 levels but to substantially increase them, which is no mean achievement given the type of climate in which they had to operate.

Very successful ventures have been started in Ennistymon, Tuamgraney and Scarriff in particular. There is a problem in so far as the closure of GAC seriously affected a number of small industries but I know that SFADCo are trying to tackle the problem at present. While there may be difficulties, I am confident that they will overcome them, especially in the Shannon region. South west Clare also has problems in regard to unemployment and if it were not for the development at Moneypoint things would be even worse, particularly in Kilrush. I wish to add, for the benefit of Deputy Daly, that if Fianna Fáil had had their way there would have been no development at Moneypoint. I urge the Minister and SFADCo to treat this is a disadvantaged area and to try to attract industry into the region because there could be a very serious problem in the Kilrush area in another year or so when Moneypoint is in operation and the site is complete.

In relation to the future role of SFADCo, there is a tremendous opportunity and all Departments and State bodies concerned will have to recognise that SFADCo are capable of taking on many and varied responsibilities. In this connection, I should like to refer to the Shannon Estuary, one of our finest national assets. If it is properly developed and managed it would be of tremendous benefit to the mid-west region. One must ask who is capable of developing and managing that project in a businesslike way. We must look at existing bodies and examine their record over the years. SFADCo must have a major role in future development of the Shannon estuary. I urge the Minister to see that they are given specific responsibility in any future Bills in this House in relation to the management of the estuary because SFADCo are tailor made to take on responsibility in this area. They have the expertise and experience and it would be irresponsible not to ensure that they can develop the area.

SFADCo recently became involved in the mariculture and fish industries and in the Carrigaholt region a mariculture development has been ably assisted by personnel from Shannon Development. I hope that Shannon Development will see a greater future for that type of development, particularly around the coast of Clare, because there are indigenous products there and there is an onus on us to ensure that they are developed to their full potential.

I was very pleased that the Minister for Industry and Commerce recently gave responsibility to SFADCo to do a pilot scheme in relation to the food processing industry and market research in relation to marketing food in a more presentable form than we have been doing in the past. There is also an opportunity for them to encourage people to grow more vegetables as recent statistics in relation to the importation of vegetables are appalling. They should tackle this problem immediately. They could do very fine work in this regard.

There are a number of very fine service industries based in the Shannon free zone and, like Deputy O'Malley, I should like to see greater emphasis on that industry in Shannon. I hope that the Department, in conjunction with SFADCo, will see this as a priority and an area which should be given greater incentive so that international companies will base their services at Shannon. It is an ideal location but somehow its attractions are not availed of as widely as one would hope for.

I wish to compliment SFADCo on doing a very fine job. Maybe some of their critics, particularly in this House, should have taken the opportunity of airing their criticisms today and coming face to face with those who have direct contact regularly with SFADCo. As Deputy for the area all I can say is that they have been extremely helpful and responsible in the way they have always worked within the region. They have a good rapport with the various local authorities, with local communities and with local politicians. This indicates their genuine interest in the region. The level of commitment given by most of their personnel in the region far exceeds the call of duty; they go to meetings all over the region at all hours of the day and night and are generous with their time. That is something that we, as public representatives for the area, appreciate.

In regard to the recent committee report on SFADCo, it would probably be more appropriate to discuss it when it comes before the House. But I would like to take the opportunity to refute a statement made by the Leader of the Opposition when he visited Limerick recently to preside at a Fianna Fáil convention. He implied that the report was the report of one particular Deputy. The record shows that report was signed by all the members of the committee representing all parties within this House. No one party can take particular credit for anything in that report. There are a number of items in the report that I would take issue with but I will deal with those when the report comes before the House.

I take this opportunity to wish SFADCo well. There is a challenging time ahead for them in the next few years but, given their record in the past, I have every confidence that they will meet the challenges and we can look forward to greater progress and greater development in the mid-west region in the next few years. This has, indeed, been the hallmark of SFADCo over the past number of years.

Mr. O'Dea

I am grateful for the opportunity to address the House on this important legislation. Most of the ground has already been covered by other Deputies from the region so I will be brief. I will commence by congratulating Mr. Tom Dunne on his recent appointment. Mr. Dunne is a public servant noted for his achievements in other fields and I wish him the very best in his present onerous position. For the sake of all in the mid-west I hope he makes a good job of it. I also want to congratulate the other executives and the ordinary employees of SFADCo because they have made a monumental contribution in the mid-west since the inception of SFADCo. SFADCo have a number of tremendous achievements to their credit, many attained in the face of severe difficulties and despite opposition and sniping by Deputies from other constituencies who, in an attempt to gain short term political kudos for themselves in their own areas, criticised and tried to curtail the activities of SFADCo. Some Fine Gael Deputies in the Cork region have suggested that SFADCo should be abolished altogether. It would be a sad day for the mid-west region if this agency were to disappear. The attitude taken by those Deputies is irresponsible and shallow, not recognising the achievements of SFADCo and the magnificent contribution SFADCo still have to make in this region if properly directed and controlled.

Deputy Daly and others asked if the present legislation is sufficient. It is a step in the right direction but it is not sufficient to attain what needs to be attained. I have spoken on many occasions, of the need for a whole new direction for SFADCo. New goals, new targets, a whole new spirit of adventure are needed if the present atmosphere of despondency, depression and despair is to be lifted and something positive and tangible done about creating employment and attracting employment opportunities to the region. We are talking not about public relations exercises but something tangible, something positive. That is the role we see for SFADCo, and that has been their traditional role.

In recent years there has been a certain loss of momentum because of the lack of definite attainable targets. Some of the original goals set for SFADCo have been achieved. The change in the industrial structure, the change in the nature of industry has created new challenges and new opportunities. But it has also created a need for new targets, new goals. As somebody who is concerned about the welfare of the region and about the recent loss of employment in the region, I should like to see legislation brought in which would set those new targets and new goals and a definite sense of direction for SFADCo. I regret this has not been done but I also welcome the commitment by at least some of the Government to maintaining the present status of SFADCo and the commitment of some of my colleagues on the opposite benches to an enhanced role for SFADCo in the future.

Recently the Dáil Committee on Public Expenditure produced a report which dealt at length with the cost effectiveness of SFADCo. I have read that report in detail and I interpret it as highly complimentary of SFADCo and its attainments and cost effectiveness. The chairman of the committee, Deputy Keating, chose to issue a separate statement accompanying the report in which he put his own highly negative interpretation on how the Dáil Committee on Public Expenditure saw SFADCo. I deplore that. It is a very unwelcome development that the chairmen of these responsible committees are putting their own particular political bias and their own gloss on these detailed reports. We can all read those reports for ourselves. Political commentators, financial analysts, financial commentators and those of the public who are interested can read those reports and draw their own conclusions. We do not need Deputy Keating or anybody else to draw conclusions for us.

I deplore Deputy Keating's hostility towards SFADCo which was clearly evident in the statement which he issued to accompany that report. In the past I asked the Leader of the Progressive Democrats, Deputy O'Malley, whether he agrees with Deputy Keating's attitude towards SFADCo as expressed in the statement which accompanied that report. To date I have received no answer from Deputy O'Malley and I did not hear him answering that question tonight in his contribution. I doubt that we will get an answer. The Progressive Democrats can also differ amongst themselves; they are nothing out of the ordinary but very much like the rest of us in that regard. Deputy O'Malley made his reputation largely on his achievements in this field and many of the jobs Deputy O'Malley chose to take credit for were generated through SFADCo.

When Deputy O'Malley was Minister for Industry in the year which was, in terms of job creation, the crowning jewel of his achievements, the local boss of SFADCo, Mr. Michael Daly, was given the award of Limerick man of the year, indicating that the local business people were well aware of SFADCo's role in creating those jobs. It is regrettable that a member of Deputy O'Malley's new party should manifest an open hostility to SFADCo. This is something which I, the people of the region generally and I am sure Deputy O'Malley must regret. I am saddened not to hear that Deputy admit this.

Deputies Daly and Lyons spoke about the potential for job creation generally and particularly in this region. We are all aware of the difficulties experienced in attracting industry and creating sustainable, viable, long term jobs outside Dublin and particularly in isolated rural areas. In that regard SFADCo have done a magnificent job in so far as they have been allowed by central agencies and Government Departments. It is a fundamental part of the Fianna Fáil policy and, indeed, philosophy to decentralise industry as much as possible, both for economic and social reasons. SFADCo were set up specifically with that goal in mind for a particular region. In so far as they were allowed, they succeeded magnificently. We want a re-emphasis and re-concentration on that role. The past record will show that it can be done; to my way of thinking, it must be done. As regards employment creation in industry, the concentration must be on small industry. If the history of the past five to ten years has taught us anything, surely it has taught us that.

Agencies such as SFADCo have a fantastic new role to play in the development of the economy for the next 20 years, particularly in the field of job creation. International economists tell us that service industries will become increasingly important in this respect; I accept that. There will still, of course, be a role of job creation in manufacturing industry, but the service industries are assuming an increasing importance with regard to employment. The new board of SFADCo must direct their attention to that matter, which has been proved beyond doubt or argument. There is a need for concentration on smaller type operations, whether in the area of providing services, or in manufacturing industry. SFADCo are a perfect mechanism for the creation of employment in that field. That is why we need, not a reduction of their role or a scaling down of their operations, but rather an enhanced role for an agency of this sort.

We in Fianna Fáil are fully committed to SFADCo and to an enhanced role for them. My region owes a tremendous amount to that company. Whether it be to the forefront of their consciousness or not, many of my constituents should be very grateful to SFADCo. We in Fianna Fáil are committed to it because of our basic philosophy for industrial job creation, particularly decentralised industry, as against having all the services in Dublin as well as all the job creation activities. It is part of our philosophy to spread these activities out. As Deputy Daly mentioned, there is also a role for decentralisation in this context. We have suggested in the past that more of the operations of Aer Rianta should be carried on in Shannon. There may also be room for moving some part of the Department of Communications to the Shannon region and I understand that some studies have been done on that question. I urge the Minister to comment on his Government's policy concerning decentralisation and to explain why that process has not only slowed down but come to a full-stop over the past three years. Because we are committed to decentralisation, we are committed to an enhanced role for agencies such as SFADCo.

I conclude by complimenting the Shannon Free Airport Development Company on their achievements in the past. If they are given a proper role and appropriate freedom to carry it out, I am sure that their achievements in the future will be just as good.

Minister for Industry and Commerce (Mr. Noonan,

Limerick East): I thank all the Deputies who contributed to this debate. It is clear from the contributions that there is a broad consensus among all major political parties in support of the Shannon Free Airport Development Company and their development. As I said in my opening contribution, the purpose of the Bill is essentially an enabling one, increasing the statutory limits on the moneys which may be annually voted to the company by the Dáil.

It is apparent from what has been said today that there is a great deal of familiarity with the operations of SFADCo and accordingly I need hardly elaborate on my earlier contribution. There are, however, one or two aspects of the company to which I have not yet alluded and I shall take this opportunity of doing so. Shannon Free Airport Development Company, as local Deputies are aware, have been very successfully involved in urban renewal projects in Limerick city, with the Granary being one very good example. While the company have in recent years been less active in that area than previously, I am confident that the very attractive incentives for inner city development announced by the Government earlier this year will create a significant opportunity for SFADCo, in consultation with Limerick Corporation, to stimulate the development of commercial, trading and industrial activities and thereby ensure that historic areas of the city are revitalised.

Deputies will be aware that the Government decided, in the context of the White Paper on Industrial Policy, that the time had come for SFADCo to withdraw from their local authority type responsibilites for Shannon town, given that the latter had effectively reached a mature condition. There was no good reason for that company's continued involvement. I am aware that discussions are proceeding between the company and Clare County Council and while I am satisfied that the complex and unprecedented nature of the handover means that it cannot happen overnight, I am equaliy happy that there is no lack of commitment on the company's part in implementing Government policy in this regard. It would be wrong of me to pretend that I am happy with the pace of developments. In consultation with my colleague, the Minister for the Environment, I shall be doing everything possible to encourage both SFADCo and Clare County Council to bring this matter to a conclusion.

I should also like to take the opportunity of thanking Mr. Paul Quigley, who has been managing director of the company for many years, for his major contribution. I wish him good health and happiness in his retirement. I should like to endorse what other Members of the House have said in giving every encouragement to the new chief executive, Mr. Tom Dunne. We shall be back here shortly debating the report of the Dáil Committee on Public Expenditure on SFADCo, when we can have a more wide-ranging debate. Suffice it to say that I am grateful for the contributions of Deputies on all sides of the House, which were so constructive and so supportive of the company.

Question put and agreed to.

Committee Stage ordered for Tuesday, 17 June 1986.