Dáil Éireann díospóireacht -
Tuesday, 5 Dec 2000

Vol. 527 No. 3

Adjournment Debate. - Company Closures.

Mr. Browne

(Carlow-Kilkenny): Having met the workers concerned, I am aware that, apart from Deputy McGuinness and myself, you, a Cheann Comhairle, know exactly what is wrong in this case. The appointment of a liquidator coming up to Christmas has come as a shock to the 15 or 16 workers who are permanently employed in Independent Analytical Systems, a company which appeared to be doing well. If part-time workers are included, the workforce total which is affected is 21.

Bagenalstown is a lovely town for visitors who pass through by barge on the River Barrow, but it could do with extra industry. It certainly is not acceptable that any group of workers is released from employment. I hope the Minister will explain what exactly is going on in that company. Conflicting stories emerged from a report in a newspaper last Sunday, and they are difficult to understand. The businessman concerned was so successful in his home base that he made a profit of £500,000 in 1999. Five weeks ago he bought this company in Bagenalstown but then called in a liquidator. I am totally baffled because people involved in business are generally hard-nosed individuals who weigh up everything and eventually come into an enterprise because they can see a future in it. I find it totally baffling that after five weeks a new owner can go into liquidation, even though his own home company, based in Portlaoise, made a profit of £500,000 in 1999. The Sugar Company, which has been taken over by Greencore and which accounts for 47% of the workload of the company, has caused a problem for it by reducing the price it is prepared to pay for sample tests from £41 to £30 approximately, which is a source of some surprise. Some of the workers are willing to take over the company provided that the Sugar Company, with which I hope it will be possible to arrange a meeting, will account for 47% of its workload.

The reason the Sugar Company is seeking a reduction is that Teagasc can undercut the company. I find it strange that Teagasc can undercut a private company causing redundancies. It should stick to what it is good at, advising farmers. If it wants to enter competition, there should be a level playing field. Teagasc and Independent Analytical Systems cannot compete on a level playing field.

The workers who are willing to take over the company must know the facts. I am not certain that the article which appeared on Sunday clarified the matter. The workers are of the view that some of the information contained within it was incorrect. What exactly is going on in the Sugar Company? Could it have lost £600,000 over a ten year period and, if so, why? What can the workers take from this debate that will help them to make up their minds as to whether they should take over the company? They have the necessary expertise to keep it going. It is important, therefore, that they know exactly what is going on. The Minister of State has the background information.

Should it happen that the workers cannot take over the company, the Minister of State should look on Bagenalstown as a place which needs new industry. From the point of view of the Government, the loss of 20 workers in Bagenalstown would not be a catastrophe in comparison to the loss of 150 elsewhere, but to Bagenalstown, which has few industries, it would be a major blow. It is relying more and more on the attraction of new industries. I, therefore, hope the Minister of State will give the workers some hope to move forward.

Mr. McGuinness

I join my constitutency colleague, Deputy Browne, in highlighting the difficulties being experienced in Muine Bheag, Bagenalstown, County Carlow. Bagenalstown is a small, rural town with a population of 3,500. Its traditional business structure has recently failed. Small traditional businesses have closed due to changing times in rural areas resulting in job losses. The local economy is threatened. The threatened closure of Independent Analytical Services with the loss of 17 full-time and four seasonal employees is a blow which is particularly hard to take at this time of year.

It is also hard to take when one reviews the activity of the company. It has a satisfied and happy customer base. Greencore, located only ten miles from Muine Bheag, accounts for 47% of the business transacted. The quality EUF system has the capacity to deliver up to 500 samples per week on a ten day turnaround basis. The workforce is skilled and has proved that it can compete with the best. The shop steward, Ms Christine O'Neill, and chairman, Mr. John Barry, in conjunction with the trade union representa tive, Mr. Denis Hyne, will confirm that the company has an excellent industrial relations record and a very good relationship with all of its customers.

The Department of Enterprise, Trade and Employment or Enterprise Ireland should contact Greencore, the Sugar Company to secure the jobs in question while solutions are sought – either a take over by companies in the United Kingdom or elsewhere waiting to enter the Irish market in this area or facilitating the employees of the company to take it over. Will the Department or Enterprise Ireland arrange such a meeting to facilitate such a debate which should involve public representatives and the employees of the company? Can the county enterprise board enter the negotiations to save the jobs in question?

Can the exact position be determined? As Deputy Browne outlined, the employees of the company read about the trading details of the company in a Sunday newspaper. This is not a great way to receive a communication from either management or the liquidator. Perhaps a meeting with the liquidator, Mr. A. J. Fitzpatrick, would be appropriate to determine the facts of the case.

Lest the company collapse, can FÁS and all other State agencies, including Enterprise Ireland, enter into immediate discussions with each and every employee to assess their skills and determine if they can be placed elsewhere in the local economy?

Can Enterprise Ireland or another State agency be requested to acquire the building and locate within it a developing indigenous company? The town has been devastated by the loss of employment. It has no land zoned for development. There are only between seven and ten companies in the existing industrial estate. Can any State agency assist in the purchase of the building or, alternatively, assist the urban district council to purchase it or a landbank to facilitate the development of an industrial base in Muine Bheag which is affected by this sad news at this time of year?

Does the IDA have a role to play? Can it focus its attention on Muine Bheag? There may be competitors outside the country willing to enter the Irish market and which would gladly work in partnership with the current set of employees because of the base they have established to develop the company and set it on the right road for the future. This can be achieved if an initial meeting with Greencore, the Sugar Company can be arranged which should involve public representatives and the trade unions to, at least, ensure the jobs in question are secure while negotiations and meetings take place.

Due to the Government policy on rural development which involves the establishment of the roots of companies in rural Ireland and the relocation of certain companies from more popu lated areas such as Dublin and the other main urban centres, areas such as Muine Bheag are being looked at. All the community needs is the support of the Government and State agencies to ensure there is a ray of hope and it is kept together in terms of employment. Great strides are being made locally. Great attempts have been made to keep the company open. The workers have been in negotiations and have the support of the local community and public representatives. An input by all the State agencies would be of assistance. Given its interest in the skilled workforce taking over the company, the county enterprise board may have a very significant role to play.

Every action should be taken immediately. We should be proactive. While 21 jobs may be a small number, in a local community with a small population which has been affected by other closures, this is a serious blow, one which we cannot stand over. There is a need for immediate action.

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

I thank the Deputies for raising these matters on the Adjournment. I understand Independent Analytical Services went into liquidation last Tuesday and that the total staff of 17 were issued with redundancy notices to take effect prior to Christmas. Deputy Browne said that this will have a major impact on a rural area such as this. In response to the suggestion made by Deputy McGuinness, FÁS has agreed that placement staff will meet with the company employees and conduct individual interviews with all the staff concerned. They will be offered the full range of FÁS services available.

Enterprise Ireland is working proactively to address the development needs of its client companies in the south-east region. To this end it has taken action across a range of initiatives. These include working directly with individual companies, working at a sectoral level with groups of companies and working proactively to encourage the development of new start up enterprises. This is evident from the performance of the south east region in 1999. In terms of job gains it was second to Dublin. Investment support approvals in the south east in Enterprise Ireland client companies in 1999 was £6,990,192, which was the third highest level of approvals in the country after Dublin and the north east. Enterprise Ireland in the south east is working with a portfolio of 346 companies employing a total of 16,000 people in a structured way to help them increase sales, exports and jobs.

The Enterprise Ireland international services programme is also being strongly promoted in the region to raise awareness in relation to this growing sector. Enterprise Ireland's south east regional office is in discussion with a number of software and information and communications technology promoters. The south east region of Enterprise Ireland has as an objective to locate indigenous internationally traded services projects in the region. These include software developers, call centres and shared services centres.

IDA Ireland, which is the development agency with responsibility for attracting overseas industry to Ireland, has a significant presence in Carlow town with approximately 1,300 people employed in eight companies in the town. Chief among these are Braun Ireland Limited. I visited that plant recently with regard to a health and safety matter. It employs 885 people and Lapple Ireland Limited employs 289. The presence of these quality employers in the town has had a positive spin off for employment in the county overall.

Future plans for Carlow, which includes Muine Bheag in its catchment area, include the development of a high quality business and technology park at a newly acquired 50 acre site in Carlow town. It is proposed also, early in the new year, to seek planning permission for the erection of 100,000 square foot of high-spec office accommodation targeted at the international services section, which will include software development, financial services and customer services operations. In addition, it is proposed to seek submissions from developers to erect and finance a 25,000 square foot advance factory at the existing IDA industrial estate.

In addition, the Carlow County Enterprise Board, established in 1994, has been active in the micro enterprises sector. During the period 1994 to 1999, the board assisted in the creation of 597 full-time and 340 part-time jobs in Carlow.

Mr. Browne

(Carlow-Kilkenny): In the name of goodness, what has this to do with the subject of the debate?

An Ceann Comhairle

The Minister is replying to the debate.

Mr. Browne

(Carlow-Kilkenny): He might as well be reading about a flood in Timbuktu.

Mr. T. Kitt

Debates such as this give a chance to give an overall perspective on employment in the area and the positive things that have happened.

Mr. Browne

(Carlow-Kilkenny): It has nothing to do with the unemployment problem we raised.

Mr. T. Kitt

I will try to address the issues raised. Obviously, I cannot deal with every issue but I will be happy to pursue the issues raised by the Deputy.

I am pleased that unemployment figures in County Carlow, generally, have been falling in recent times, with the total number of unemployed standing at 2,009 compared with 2,577 in 1999. The Government is committed to ensuring the most equitable regional distribution of job opportunities and has impressed on the industrial development agencies, IDA Ireland and Enterprise Ireland, the crucial importance of making greater efforts to provide employment throughout the country. I will pursue the suggestions made by Deputy McGuinness with regard to the agencies, particularly Enterprise Ireland. Moreover, the development agencies are structured on a regional basis to facilitate a balanced regional distribution of jobs, and resources are being deployed to reflect this focus. The agencies' focus on regionalisation ensures that an attractive financial package will be made available to any appropriate project which may choose to locate or expand in the region.

The strategies of the Department for the continued promotion of enterprises focus on the promotion of Ireland as an attractive location for foreign direct investment and on the further development of the indigenous sector. Complementary measures in the national development plan will also help to underpin the regional strategies of the development agencies. The measures provided for in the plan will provide the infrastructure necessary for the attraction of overseas investment currently lacking outside the major urban areas.

I am confident that the strenuous efforts being made by the industrial development agencies – Enterprise Ireland, IDA, FÁS and the Carlow County Enterprise Board – will continue to yield positive results for Bagenalstown and County Carlow. Any suggestions made by the Deputies with regard to the activities of particular agencies will be conveyed to those agencies.