Willie Penrose
Ceist:22 Mr. Penrose asked the Minister for Public Enterprise when the balance of the money committed to Bord na Móna by the previous Government will be paid; and if she will make a statement on the matter. [14925/97]
Other Questions. - Bord na Móna Funding.
Last week the Government provided £51 million to Bord na Móna. A total of £100 million equity has now been injected into Bord na Móna. The effect of this financial support from the State is that Bord na Móna has now been placed on a sound financial footing.
I am delighted my colleague is handling this brief because it is in safe hands. Bord na Móna, which suffered 2,500 job losses, means a lot to us in the midlands.
An earlier proposal suggested that the overall equity would be £110 million. I appreciate that legislation is required to establish Bord na Móna as a public limited company. How soon will that legislation be introduced and will it be utilised to amend the cap on the equity to Bord na Móna, which was set at £100 million, so that it receives an extra £9 million or £10 million? An injection of such equity would mean cheaper fuel for the ESB and it would be important for Bord na Móna. Is the Minister aware of any plans to introduce the legislation to establish Bord na Móna as a public limited company and, if so, will she ensure that the extra £9 million or £10 million is forthcoming?
As the Deputy knows, last December the commission gave its formal decision as to whether it breached State aids and immediately afterwards the first injection of equity, £49 million, was made. The Minister for Finance, Deputy McCreevy, who also comes from bog country, decided to make the tranche of £51 million available in September rather than December. Some £100 million is the maximum that can be paid under the Energy (Miscellaneous Provisions) Act, 1995.
I hope the turf development Bill, which is important for Bord na Móna, will be laid before the House during this session. When I visited Bord na Móna in County Kildare I was struck by the way the board directly reflects the interests which are of great help to it and by the assiduous way the chief executive officer, the chairman and the members of the board attend to their duties after their recent difficult times. I was glad we were able to make progress on this matter. The Deputy asked if I will include a provision in the Bill to allow for the payment of the remaining £10 million. I expect that £10 million will be considered next year but I will see if it can be included in the Bill.
While this equity will put them on a safe financial footing, it will also pose huge challenges for them. The chairman correctly indicated that two months ago when he published last year's reports. Bord na Móna must be more competitive. The fact it no longer faces debts will be a great relief but there will be ongoing challenges. However, I have no doubt it will face them and make good decisions. I wish it good luck and I will keep a partisan eye on it.
As someone who comes from the heart of the bog, I welcome the Minister's decision to top up the payment already made. Given that the ESB will be getting cheaper turf for its coal burning stations and the State has agreed to refurbish some midland stations and has removed the crippling debts faced by Bord na Móna through its investment, will it be able to reduce the price of electricity to the consumer? The good morale in Bord na Móna is evident since the removal of that debt.
I am aware of that from constituents and others. The savings accruing to the ESB as a result of this reduction must be seen in the context of the overall cost savings which the ESB is achieving under the cost and competitiveness review. It is my policy to ensure that the savings achieved by the ESB should be shared by the consumer.
I understand that the turf development Bill will necessitate restructuring in Bord na Móna. When the Minister visited the headquarters of that company in Newbridge, did she cast her eye over the peat moss division? Is she aware that the financial performance of that division is worrying if not difficult, and how does she propose to remedy the matter? What are the Minister's views on this?
I was made aware of this problem, studied the relevant data and spoke to the chairman and members of the board about it. The forthcoming turf development Bill will lay out a general strategy under subheadings for the four "companies" within Bord na Móna, which the board will then tackle. I have no doubt that the board is already attempting to do so with great vigour. I am struck by the inventiveness and ingenuity of the board in the way it is endeavouring to develop new ideas and make them profitable and viable. The forthcoming Bill will address the Deputy's concerns.