Dáil Éireann díospóireacht -
Wednesday, 9 Dec 1998

Vol. 498 No. 2

Adjournment Debate. - Kilkenny Textile Mills.

Mr. McGuinness

Kilkenny Textile Mills has a factory located in Kilkenny city employing in excess of 80 people. In recent weeks and months a number of them have been laid off on a continuous basis. Two thirds of the product manufactured by Kilkenny Textile Mills is purchased by Santens in Belgium. The other one third is offered on the open market. As part of the package that should be put in place to ensure the viability of the company, that one third should be marketed on the basis of local indigenous industry supporting the company and purchasing its product.

Kilkenny Textile Mills has been an excellent employer since Fieldcrest first operated in the industrial estate in which it is located. It unfortunately closed down. Kilkenny Textile Mills took up the challenge, offered a number of jobs and has continued to employ 80 people.

We all know the difficulties facing the textile industry from the various low cost countries. The market is being affected and this is affecting the situation in Kilkenny. Employees being let go during the Christmas period should be given maximum social welfare payments and the question of taxation on them should be reviewed. The Minister should also negotiate with Kilkenny Textile Mills to ensure that the one third of the market about which it is concerned is fully developed to give the company the opportunity to continue with a programme of full employment without any lay-offs in the future.

In the recent creation of 1,400 jobs for the country, not one was announced by Enterprise Ireland for Kilkenny city or county. That has been the case historically. Bearing in mind the Bellview operation, approximately 400 jobs have been created by IDA Ireland for Kilkenny. Nationally that figure does not stand up. It is not good enough.

I am asking for immediate action on Kilkenny Textile Mills and an immediate offer of support to the company. If we acknowledge now at an early stage that the textile industry is going through serious difficulties, that there are serious problems in the market place and that there are serious challenges from other low cost countries we could create a mechanism that would at least bridge the gap and make the playing field a little more level.

With regard to the employees, I ask the Minster to intervene at Christmas to ensure they get the maximum benefits and that the question of taxation on the benefits is analysed to see what can be done to alleviate it.

Minister of State at the Department of Enterprise, Trade and Employment (Mr. T. Kitt)

I share the Deputy's concern about the recent developments at Kilkenny Textile Mills. The move to short-time working is a disappointing development for the plant. However, I am sure the Deputy will appreciate that the company must react to the market and it is better that necessary corrective action is taken now by way of short-time working to help safeguard jobs in the plant.

Kilkenny Textile Mills has been operating regular short-time working through 1998 by agreement with the unions. The workers have been taking one week off in four to maintain full employment and to match the fall in demand for yarn as the result of market recession in the product sector in Europe. Recent reports on the planned one week lay-off before Christmas are in line with the agreed programme of short-time working during 1998. The plant will reopen in early January and every effort is being made by the parent company to rejuvenate its European sales levels and restore the plant to full working.

There is no doubt that labour intensive sectors, such as textiles, both in Ireland and throughout the EU are coming under increasing competitive pressures. Companies operating in these sectors must adjust to the challenge by becoming more innovative if they are to survive and remain viable in an increasingly open and global marketplace. The various State development agencies, as well as FÁS, are actively assisting the textile industry to restructure and reposition and in this regard I am aware that Kilkenny Textile Mills was granted assistance under the EU RETEX programme, which was geared towards improving its competitive position.

The House will realise that while the support agencies play an important role in helping industry to develop and expand, much depends on the external trading environment and the competitive intensity of the market segment in which the company positions itself. I assure the Deputy that the development agencies have been made aware of our determination to focus to a much greater extent than in the past on the creation of new job opportunities in the regions. I hope the strenuous campaign being mounted by the various agencies, both generally for the regions and more specifically for Kilkenny, will have positive results in the medium term.

During the last year IDA Ireland developed a 50 acre sight in Kilkenny and the construction of a 25,000 square foot advance factory has commenced. In addition, planning permission has been obtained for the provision of a 20,000 square foot office facility for the promotion of internationally traded services companies. Construction of the office facilities is planned to begin in January of next year.

IDA Ireland continues to emphasise the south-east region, including Kilkenny for new employment opportunities, for example, international services in addition to trading manufacturing. I assure the Deputy that IDA Ireland is working closely with Kilkenny Textile Mills to offer assistance wherever possible and it will keep me fully informed of developments.