Dáil Éireann díospóireacht -
Wednesday, 15 Mar 1995

Vol. 450 No. 7

Written Answers. - Irish Steel Viability Plan.

Michael McDowell

Ceist:

27 Mr. M. McDowell asked the Minister for Enterprise and Employment the separate studies his Department have conducted into the feasibility and the cost benefit analysis into proposed areas of capital expenditure on Irish Steel; if his Department has commissioned any such study or retained consultants to advise on these expenditures; and if he will make a statement on the implications of these proposed expenditures for the Exchequer. [4420/95]

Minister for Enterprise and Employment (Mr. R. Bruton)

The Deputy's question focuses on the capital expenditures proposed in the Irish Steel viability plan. I have previously stated my position in relation to these expenditures in an Adjournment Debate on Irish Steel in the House on 23 February 1995 (column 1669, line 40). In that debate I stated that it will have to be shown that the capital investment projects will meet the cost and benefit projections that have been put forward in the viability plan before any funding will be committed to them.

Irish Steel have had an independent assessment of the viability plan carried out and I have had access to this. I have also appointed IBI Corporate Finance Ltd. to act as advisors in relation to the possible sale of a stake in Irish Steel. As part of that exercise IBI in conjunction with the international steel consultants, Beddows & Co., will carry out an assessment of the viability plan.

The European Commission is arranging to have an independent assessment of the Irish Steel viability plan and the capital expenditure proposals contained therein, carried out as part of the process of considering approval of State aid to Irish Steel.

In addition to all of these analyses of the Irish Steel proposals it may still prove necessary to have specific independent assessments carried out of particular capital investment proposals. However it would be premature to initiate any such assessments until the Government and the European Commission's consultants have completed their assessments.

Anyone taking a stake in Irish Steel will be expected to contribute to the investment programme. The level of investment will depend on negotiations.

It will be evident to the Deputy from the foregoing that it is too early to give a detailed answer to that part of the Deputy's question which seeks to determine the implications of the proposed capital expenditures for the Exchequer. The Government has decided however that the maximum level of Exchequer support for Irish Steel, subject to European Union approval, will be IR£50 million.