We now come to deal with Private Notice Questions to the Tánaiste and Minister for Enterprise, Trade and Employment on job losses. I will call on Deputies to table questions in the order in which they submitted them to my office.
Private Notice Questions. - Job Losses.
asked the Tánaiste and Minister for Enterprise, Trade and Employment the steps she will take arising from the large number of job losses announced during the past week, including 375 jobs at Ardagh, Ringsend; 300 at Flextronics, Tullamore; 200 at Youghal Carpets Yarns; 160 at EMC Benelux, Ovens, and 80 at SMTC Electronics; the discussions she has had with these companies with a view to saving jobs; the steps she will take to secure alternative employment if this does not prove possible; and if she will make a statement on the matter.
asked the Tánaiste and Minister for Enterprise, Trade and Employment the steps she proposes to take to deal with the matter of job losses in view of the fact that almost 1,200 jobs have been lost in the past week; and if she will make a statement on the matter.
asked the Tánaiste and Minister for Enterprise, Trade and Employment the action she will take in view of the proposed closure of the Ardagh glass bottle plant, Ringsend, Dublin 4, with the loss of up to 375 jobs; the serious consequences for the people employed in the plant; the impact on the community of Ringsend; the major repercussions for the recycling industry and the consequent impact on the environment due to the loss of this major facility.
asked the Tánaiste and Minister for Enterprise, Trade and Employment the plans she has to ensure that the Ardagh plant in Ringsend, Dublin 4, remains open to secure the continued employment of 375 people and the future viability of glass recycling here; and if she will make a statement on the matter.
asked the Tánaiste and Minister for Enterprise, Trade and Employment the action she will take in view of the closure of Youghal Carpets Yarns at Carrigtwohill, County Cork; the meetings she has had or plans to have on the issue; and if she will make a statement on the matter.
asked the Tánaiste and Minister for Enterprise, Trade and Employment the action she will take in view of the announcement by Flextronics, Tullamore, that it will lay off 370 workers within the next three weeks; and if she will take immediate steps to ascertain the reasons for such large scale lay-offs and to provide alternative employment for the redundant staff.
I propose to take all the questions together.
I am annoyed and disappointed the Minister is not present. Where is she?
I will answer the last question first. I apologise for the absence of the Minister, which is due to her being out of the country on Government business. The Minister and I share the concerns of the Deputies about the adverse consequences for workers of recent announcements of job losses at various locations. These include announcements over the past week of significant job losses in the Cork region, for example at Youghal Carpets Yarns, EMC and SMTC, at Flextronics in Tullamore and at the Ardagh plant in Dublin. I am very conscious of the fact that job losses affect not only the workers but also their families and the economic and social life of the areas involved.
In the immediate aftermath of announcements such as these, our priority is the mobilisation of the resources of State agencies to provide any assistance possible to those affected. The full services of the agencies of my Department are available to respond to such difficulties. These agencies, including IDA Ireland, Enterprise Ireland, FÁS and the county enterprise boards, work closely with the companies involved to address their difficulties and to assist the workers being made redundant in finding other employment opportunities. The State development agencies work closely with the county development boards and county councils as well as local development and other interests in areas affected by job losses to facilitate an integrated development approach and promote a favourable environment for business. Given the focused agency approach, in co-operation with company and local development interests, I am confident that these combined efforts will facilitate the provision of alternative opportunities for workers affected by job losses and strengthen the economic and social development of the areas affected.
Ardagh plc announced last Thursday, 28 February 2002, that it was closing its glass container manufacturing facility in Ringsend, Dublin. The reason given was failure to secure required improvements in work practices which, together with improved pricing, the company considered necessary to secure the future of the facility. A total of 375 people are employed in the plant. The Labour Relations Commission met the management and unions at the company this morning. It has put a formal proposal to both sides to enter a process of negotiations on a survival plan for the plant. The survival plan will involve major cultural and work practice changes to make the plant competitive. The company has agreed to the proposal and a response is awaited from the trade unions. The implications of the possible closure of this plant for recycling in Ireland will be the subject of an Adjournment debate later today involving the Minister for the Environment and Local Government.
The management at Flextronics, Tullamore, announced yesterday that it will be making 370 of the 440 employees at its Tullamore plant redundant due to loss of significant business from a major customer because of lack of competitiveness. FÁS has been in contact with the management of Flextronics and has offered its full range of support services. That support will include advising the staff facing redundancy of the employment or training of which they can avail. IDA Ireland is in close contact with the company with a view to providing any assistance possible in this difficult situation.
On Friday, 1 March Youghal Carpets Yarns, which employs 200 people in the production of dyed yarns for the carpet industry, announced the closure of the plant due to the continuing downturn in the market for yarns, particularly in the UK and US. The Minister met unions representing workers at the company yesterday and following this, a meeting was arranged between IDA Ireland and the company for tomorrow to discuss a long-term viability plan. EMC Benelux, which is involved in the manufacture of information storage systems, announced last Monday that it would be making redundant approximately 150 of the 1,600 workers at its plant at Ovens, County Cork. The redundancies were necessary due to the delay in recovery of the ICT sector in general and the slow rate of investment in new IT infrastructure such as storage devices. SMT centre, Model Farm Road, Cork, which provides electronic contract manufacturing to the electronics industry, announced a significant reduction in employee numbers – 80 temporary staff – due to the appointment of a receiver to its main customer in the UK. The company is continuing to review its position in consultation with the employees and the receiver in the UK.
It is necessary to see job loss events in the context of major growth in the economy and employment in recent years. Despite the temporary setback experienced in 2001, manufacturing employment has increased in Ireland by almost 23% since 1989, although there have been falls in employment in other major economies such as the USA, the UK, Germany and Japan. There are also very encouraging signs that the policies being adopted by the enterprise development agencies to promote the development of more jobs in the regions are having a positive impact. Figures show that the share of new job creation in the BMW region rose to 25.3% in 2001 from 20% in 2000 and only 17.8% in 1999.
The policies of the development agencies, which are to attract knowledge-based activities to locate in Ireland and to improve the competitive capabilities of indigenous firms, will continue to be vigorously pursued in 2002 and will be assisted by the improvement in international trading conditions which is expected later this year. The reduction in permanent employment in 2001 was very much confined to the electronics and high-tech manufacturing sector. Other sectors, including chemicals, food, drink and tobacco, wood and wood products and internationally traded and financial services, increased their employment levels. For example, employment in internationally traded and financial services increased in both Irish-owned and foreign-owned firms in 2001, as it did in the chemicals and food sectors.
The increase in the level of job losses here in recent months is a consequence of the downturn of the past year in the US and global economies and the slump in the ICT sector. The situation was exacerbated by the tragic events in the US on 11 September. The rise in unemployment from historically low levels is expected to be short-term and good economic and employment growth should resume over the medium term. While the recent rise in unemployment was not unexpected in light of difficult global economic conditions, we should take comfort in the fact that our unemployment rate of 4% is among the lowest in the EU and that the level of long-term unemployment has substantially improved over the past decade and is currently at 1.2%. Ireland's economic performance in the current year is highly dependent on recovery in the international economy, especially in the US. As regards foreign direct investment, while some improvement in 2002 compared to 2001 is expected, it is recognised that this is critically dependent on recovery in the US economy and the ICT sector in particular.
Trading conditions in key export markets will be difficult in 2002, especially in the first half of the year, and there is uncertainty about exchange rates between the euro, sterling and US dollar. While there are prospects for a modest pick up in trade and mobile foreign investment in 2002, it will take some time before this has a positive impact on the jobs front.
In responding to the current difficult environment, IDA Ireland is focusing on a number of key objectives including a more even geographical distribution of new greenfield investment; increasing the quality of foreign investment in Ireland by helping existing clients to move up the value chain into higher value products and services and into higher order functions such as research and development; pursuing high quality new investment that is in keeping with the competitive characteristics of the Irish economy; and promoting developments in the wider economy that enhance the business environment and, therefore, improve the capability to win high quality investment for Ireland, for example, infrastructure, skills, etc. The continued advancement of key developments in infrastructure, skills and education, particularly those set out in the national development plan, are critical if we are to be in a position to take full advantage of the upturn when it comes.
As regards the promotion and development of indigenous industry, Enterprise Ireland is focusing on three key areas: sustaining support for research and development, leading to innovation and increased competitiveness—
On a point of order, is it normal when a Minister is reading from a script that Members of the Opposition are supplied with a copy of it?
We are dealing with Private Notice Questions. We must be conscious that six Members have tabled questions to the Minister. We need a comprehensive reply.
Is it normal that a copy of the script is supplied to Members?
I would be happy to make a copy of this available to Deputies who raised the issue.
It would be of benefit to Members in asking supplementary questions if they had a copy of the script.
I will endeavour to make a copy available to Deputies as soon as possible this evening. Deputies should contact my office.
We would like to have them now.
I have not got them now. I mentioned that Enterprise Ireland is focusing on three areas: sustaining support for research and development, leading to innovation and increased competitiveness; market development and, in particular, initiatives for increasing the number of in-market trade promotion activities and continuing to increase the number of incubation centres and occupancy rates in key overseas markets; and an intense focus on arranging access to inter national buyers. Other key initiatives include co-financing with the private sector webworks in key locations around the country and co-financing community enterprise centres in small and medium sized towns.
Sustaining successful economic performance requires a rapid and flexible adaptation to new economic circumstances. In the light of the changed economic environment, action is required across a range of critical issues, for example, the cost environment for enterprise, infrastructure such as transport, telecoms, energy and waste, market regulation, public sector effectiveness and efficiency, education and training and research and development. These are priority issues which the Government is addressing.
The Government's macroeconomic policies have had a significant impact on reducing unemployment in recent years and facilitating large scale growth in jobs and investment. The new national development plan is facilitating the dispersal of the benefits of economic and industrial development throughout the regions where considerable expenditure is being incurred on employment and human resource development and on infrastructure including public transport.
Acting Chairman:
Six Members tabled Private Notice Questions. In addition, there will also be a second set of Private Notice Questions. There are time constraints and I ask Members to be short, concise and to the point.
Does the Minister agree it is fair to summarise his contribution by saying that the Minister believes that because of the job expansion Ireland has enjoyed over the past seven or eight years, we should now be content to lose jobs at the rate of 165 per day? Does the Minister acknowledge the gravity of a situation where, over the past five months, jobs have been lost at the rate of 1,000 per week? That is a haemorrhage of jobs that no amount of massaging can disguise. Is that all the Minister has to say to workers who have become unemployed in the midlands, for example, and their families, where there is little prospect of alternative employment notwithstanding anything the Minister said?
With regard to the Irish Glass Bottle Company at Ringsend, has the Minister met either the union or, more particularly, the employer? Has he met with Ardagh plc? Does the Minister agree that this is a plant that must and will be saved? Is he satisfied that Ardagh plc is not engaged in an asset-stripping operation? Is this not a straightforward industrial relations impasse and does this company not have a number of viable jobs that can and must be saved?
In relation to the last question on IGB-Ardagh, the LRC is intensely involved with both sides. The company has agreed to the proposal put forward and we await the response from the trade union. The Tánaiste has also asked the director general of FÁS to arrange an assessment of the skills of the workforce and to arrange retraining if necessary to help find alternative employment.
Has the Minister of State or the Tánaiste met with Ardagh?
I have not met with the company. The Tánaiste's involvement relates to FÁS, but as the Deputy rightly identifies, the issue is one for the LRC and the industrial relations machinery.
Ardagh must not be allowed to escape this situation. These are viable jobs.
Acting Chairman:
Please allow the Minister to speak without interruption.
I am getting an up-dated position. The LRC is heavily involved at the moment and the Tánaiste and I are available to meet all parties at any time in the coming days if that is helpful.
I gave a comprehensive account of the Government's attitude to what is happening at present and put it in the context of the agencies involved and what we are urging them to do. I talked about the efforts under the national development plan and the need to disperse investment in the BMW region. There is a clear-cut policy for the next Government, whoever makes up that Government, if it wants to pursue that approach. From my involvement with Enterprise Ireland, I know its focus and that of the IDA, which is in the Tánaiste's remit. Both the Tánaiste and I are very much in contact with those agencies and know that there is a clear focus.
The general comment I would make, and it has been heard from others in Government, is that we are trying to achieve high-value jobs. That is the objective and something that we should all pursue. I mentioned the sectors that are growing and moving in the right direction and I also put the debate in the context of the unemployment rate that we have vis-à-vis other European Union countries. However, the Government takes seriously what is happening and is conscious of the impact that job losses have on individual workers and families. It is very much involved in the particular areas. For example, my colleague, the Minister, Deputy Cowen, is closely involved with the Flextronics situation, as are other Ministers and Deputies across all parties and from various parts of the country where problems are arising. Our objective is to get the agencies to help out in every case.
I bemoan the fact that the Minister of State has come to the House with very little in terms of a plan of action to stem the increase in joblessness. Does he accept that in February the number of unemployed throughout the country increased by 4,500 and that in March that number has already exceeded 1,000? I ask the Minister of State to accept that, while he sits here holding a lengthy, rambling reply, inflation is rising and I ask him to further accept that this is home grown inflation that has nothing to do with the United States or the events of 11 September. Does he accept that the Government of which he is a part has this week increased the rate of VAT across the board by 1% and that home grown inflation and the VAT increase are contributing to the increasing costs borne by business and companies?
The Minister of State is engaging in no more than lip service when he talks about regional development. Does he realise that yesterday's announcement in County Offaly brings to more than 1,200 people the number signing on the dole in the town of Tullamore? Only last week the ESB pulled out of Rhode in County Offaly rendering another 110 people unemployed, with the consequent knock-on effect on Bord na Móna and seasonal workers. The midlands, a region to which the Minister of State said IDA Ireland is committed, is in essence an economic blackspot totally ignored by him and the Government. Has he checked the Minister's diary to know when she, the chief executive officer of IDA Ireland and his colleague, the chief executive officer of Enterprise Ireland, will visit the Laoighis-Offaly constituency with a view towards putting together a plan of action to deal with what is a very serious economic blackspot with higher than average unemployment and little in terms of hope? The Minister of State said FÁS is available to advise, but advice from FÁS is not what the families of Laoighis-Offaly want, they want replacement and alternative jobs which is their entitlement.
On the Minister's involvement, I made it very clear that she met the unions representing the workers and following that, a meeting has been arranged between IDA Ireland and the company for tomorrow to discuss a long-term viability plan. I would again say to the Deputy from Offaly that if he looks very honestly at the situation in his county, he will see there are 13 international companies in the county employing about 1,200 people. He will also find that the unemployment figures in that same county fell by 25% in the lifetime of the Government.
To what?
I understand they fell by 25% and by 40% in the Tullamore region before this announcement. One has to look at the broader picture in regard to the Government's investment and commitment to the BMW region.
I do not know who gave the Minister of State the information he has but it is misleading.
I am simply responding to the points made. We want to keep a proper perspective in this debate. That commitment will remain if this party gets back into Government.
I am sure the Minister of State will acknowledge that the proposed closure of the Ardagh plant is the second major blow to the Ringsend area following the recent floods. Was there an early warning system operating in the Department? Did the Department have any warning that this plant was in trouble? If so, was action taken by the early warning unit? Were there meetings with the management and staff? Were initiatives taken if the Minister of State had such an early warning? Will he give us details as to whether he had such a warning?
The impact will be felt very strongly by other industries in Ringsend and by Rehab. What action is the Government taking to ensure recycling can continue in this country? As the Minister of State is aware, Irish Glass processes all recycled glass recovered in Ireland. Should the proposed closure go ahead, the Government will be faced with the huge cost of exporting our recycled glass to the UK and elsewhere.
I understand the workers were in negotiations right up to the moment the closure was announced and were shocked by the announcement. Will the Minister of State spell out exactly what the Minister has asked FÁS because he mentioned alternative employment and said that FÁS had been asked to look at an assessment of skills and alternative employment? Is there a commitment from Government to ensure this plant can continue given the implications of the job losses for the workers, the area and the environment in the event that the recycling facility, which is so essential, will not be available in Ireland?
I indicated in my reply that there were issues of an industrial relation nature here. The Labour Relations Commission and the labour relations machinery of the State would have been aware of and involved in this. It put forward a proposal. I agree it would be desirable that there is a survival plan. As the Deputy will appreciate, that will definitely involve major cultural and work practice changes to make the plant competitive. The company has agreed to the proposals from the LRC and we are awaiting a response from the trade unions. There are industrial relations issues surrounding work practices. We want to see a survival plan. I mentioned FÁS and one clearly has to make plans in the context of things not working out, but everybody's objective must be to see a survival plan which will involve considerable changes.
Does the Minister of State accept that the spin put out by Ardagh Glass about the failure of employees to adopt new work practices is an insult to the workers who have bent over backwards to save this company? Does he accept the new owners deliberately let the company become run down and that despite this, it has been in profit in recent years?
I would like the Minister of State to answer questions specifically on recycling. He said that the Minister for the Environment and Local Government will answer this on the Adjournment debate but, unfortunately, we will not get a chance to question him closely. What assistance will the Minister of State's Department give to this company to maintain viable recycling because if he does not do that, it will cost this country a considerable amount of money?
I have just seen a copy of the Ardagh plc press release. I am not in a position to make a judgment on what spin people put on various announcements but I presume they will put their own position up front. I accept that but my concern is that we try to move forward and get agreement. The LRC is very experienced in this area. In my experience as Minister with responsibility for labour, it has done tremendous work in trying to knock heads together, so let us hope it does that.
Recycling is a very important dimension to this. We recycle over 30% of glass, which is at the lower end of the European recycling rate, so clearly this is an important element. The Department has been in touch with Repak to discuss the issue. Repak is charged with meeting industry's recycling targets for packaging and subsidising the collection of glass. There are lots of issues to be addressed but I am conscious the Minister for the Environment and Local Government will deal with them later this evening.
Will the Minister of State intervene to ensure recycling continues?
The Deputy can be sure that is central to any solution. My Department will be closely involved in that element of finding a solution.
On the closure of the Youghal Carpets Yarns plant in Killacloyne, what warning did the Department or the Minister of State give that there were difficulties there last December and that the workers at that time agreed a package to increase productivity, accepted redundancies and kept the factory going? Will the Minister of State comment on the fact that no warning or notice was given to the workers? What meetings have taken place between officials of his Department, himself or the Minister and the owners of the factory? What meetings are planned? How soon will this long-term viability plan come into play? Why was such a plan not put into practice before now given that it was known that this company was facing difficulties? Is it true the Government has no interest in textiles? This is the last factory in the country dying and spinning yarn. What message does the Minister of State have for the families and the workers of this plant?
On warnings, in this case the company advised IDA Ireland that it could not afford to pay more than the statutory redundancy, which it estimated at a cost of €0.5 million. The employees have an average of 23 years' service and a number of employees will be re-employed on a temporary basis to ensure an orderly wind-down of the business. That was the thinking of the company. As I said in my reply, the management at the plant have put forward proposals. As the Deputy knows, the Minister has met the unions at the company and IDA Ireland will meet the company tomorrow. We are trying to establish a long-term viability plan. I can assure the Deputy that we will closely follow the developments and keep in touch with IDA Ireland. The Deputy will appreciate that we give tremendous support and encouragement to the agencies in question, primarily in this case IDA Ireland, to see a way forward. A FÁS representative visited the Youghal Carpets Yarn plant on Monday and met management and trade union representatives.
I am very unhappy with the Minister of State's initial reply. I do not believe that there is a real sense of commitment or that he will take positive action to help redress the serious situation across Laois-Offaly, particularly in Offaly.
Is the Minister of State aware that Lowe Alpine Systems International in Tullamore recently closed with the loss of 220 jobs? Is he aware that Continental Financial Administrative Services in Tullamore recently closed with the loss of 50 jobs? Irish Casings, Tullamore, has closed with the loss of 30 jobs, Snickers Production Limited, also in Tullamore, has laid off 15 staff and Tyco Healthcare has laid off 19 staff. As the Minister outlined, Flextronics has laid off 370 staff. Leoni in Birr, which at one time employed up to 350 people, now employs only 15. At one stage Avon in Portarlington employed more than 800 people but it is now closed. Is the Minister aware that Rhode power station recently closed with the loss of 110 jobs, Ferbane power station closed with the loss of 100 jobs and Croghan briquette factory closed with the loss of 50 jobs? I helped bring many of those industries to the constituency and it saddens me to outline that many have closed in the past year or two. It is alarming.
Is the Minister of State aware that the Minister has ignored the constituency, as has the Govern ment? The Minister was present in the House this morning and it is her duty to be here tonight. Her first responsibility is to this House and she should be here. I am sure the Acting Chairman will agree that the duty of the Government is to this House.
The Minister is in Milan on international business.
There is a national duty to be done here.
Acting Chairman:
I ask the Deputy to stick to the question.
I wonder if the Minister is aware that three people from one family lost their jobs in Flextronics. A number of husbands and wives were employed there. What special incentives will the Government provide in Offaly to attract industry? There has been a decline in our traditional industries and job losses in our new multi-national industries. Will a special level of grants, remission of rates and an extensive promotion of Offaly be provided? Will the Minister of State ensure that IDA Ireland and other semi-State agencies adopt a renewed drive to attract industry? Will he make sure that the business sections of our embassies are used to attract industry to the constituency?
Rhode and Ferbane power stations have closed, but they were jobs the Government could have saved. The Government has to do something else to help provide employment. Will the Minister ensure that the decentralisation policy proceeds so that Departments will locate in both Birr and Tullamore, which are urgently in need of them?
Acting Chairman:
I ask the Deputy to come to the point.
Based on the facts I have outlined, I believe I have a duty to do this.
Acting Chairman:
The Chair has shown probably too much latitude.
I am not prepared to extend that latitude to the Government over the way it has conducted itself in recent years. It is absolutely essential that I get a commitment from the Minister that he will comply with some of the reasonable requests I have made. That is very important. I am speaking on behalf of many families and those who have lost jobs. It is a very serious matter for them and I ask the Minister to ensure that he gives a positive response.
I am very conscious of the Deputy's long commitment to the area and I wish him well in his departure from politics. As some one who was born in the west, I am very conscious of the need to ensure that we have investment outside of the main urban areas. I am a Dublin Deputy but most of my colleagues in Dublin feel the same. Those who hold ministerial office have that same sense of responsibility and attachment to the areas the Deputy has outlined. Clearly we all share, as do my colleagues, the Minister, Deputy Cowen, and Deputies Fleming and Moloney, the sentiments and views expressed by the Deputy about families and those who are suffering at this time. We must move on and try to offer help. I made the point that the agencies involved, FÁS and IDA Ireland, will certainly do everything they can.
I also made the point that positive things are happening in the Deputy's region. We often speak of the high value jobs that we are all attempting to attain through the training and education of our workforce. Under the reorganisation of IDA Ireland, the headquarters of the pharmaceutical sector is now based in the midlands. Clear policy decisions that will have a positive impact in the short and long-term in the Deputy's constituency are being made. No effort will be spared by those on this side of the House.