For some time past the Government have been considering the question of providing our requirements in cement from factories set up in the Irish Free State, and we are interested in proceeding, at the earliest possible moment, with the setting up of these factories as part of our general industrial policy. As Senators know, the demand for cement has been increasing. Owing to the wide use of cement, and owing to extensive building programmes, not to speak of road works, which are in contemplation, and which may be carried out during coming years, the demand is likely to increase. We are in the fortunate position in this country that we have available at many points very large quantities of the raw materials necessary for the successful working of this industry. At the present time our capacity is something like 200,000 tons of cement per year, and it has been estimated that about two factories will be necessary of 100,000 tons capacity in each case, to supply the existing demand. That is supposing that our total requirements are supplied from home sources. If the demand for cement for various purposes continues to increase, as it has been increasing, it is possible that a third factory may be necessary. From the investigations and discussions which have taken place regarding this matter the Government feel that the persons responsible for the building of the factory, the proprietors, will endeavour to build at points where the demand for cement is likely to be considerable, so as to reduce transport costs. The price of cement, which is a very important matter in connection with the proposals in this Bill, is not ascertainable, at the moment, as a firm figure. We do not know that until we are granted the powers which we seek in the Bill. We are not in a position to say what the figure for cement is likely to be. To a great extent it will turn on the location of the factories. The proprietors and the people who are setting up the industry will have to take that matter closely into consideration. Even as regards power costs and labour costs we are not in a position to say what they are likely to be now, but we feel—and this is the reason we have brought in the Bill—that the Minister should have certain powers which will enable him to give to whomever he grants a licence to set up a factory or factories to carry on the business, without being threatened with an undue importation of cement at a much lower price.
We are in the position here at present that the Irish Free State is said to be one of the few free markets for cement, if not the only one. Nearly all other territories are divided up between the different cartels and monopolies and the result is that the price of cement in practically every other country is regulated by the manufacturers or by combines of manufacturers. In this country, we have benefited considerably, up to the present, by reason of the fact that we are a free market and that all these various syndicates are dumping—I think I may use the word—cement into the Irish Free State at a price much lower than the price in Great Britain at present and a price, which, although I have not gone into the details, I think I would be justified in describing as below the cost of production.
If we are to set up this cement industry in this country, I am afraid it would be impossible to fix the price of cement, therefore, at the price which rules at the present time. There will be an increase in price, but it is hoped that that increase will be gradual.
Under Section 12 of the Bill, the Minister lays down certain conditions appertaining to the granting of licences. I should say that the general scheme of the Bill is that the Minister should have power to grant licences to a manufacturer of cement to set up a factory in this country and also to give him power to grant licences for the importation of cement. It is considered that it will be necessary, while the factories are being built and the supply of cement is being obtained from home sources, to control the importation of cement. Therefore, broadly speaking, there are two considerable powers which the Minister is looking for under this Bill. One is the power to grant licences to manufacturers to set up factories for the production of cement and the other is to grant licences regulating the importation of cement.
With regard to the licence for the manufacture of cement, a section in the Bill, Section 12, lays down all the various matters in respect of which the Minister may attach conditions to a licence. He may, for example, attach conditions regarding the extent to which raw materials or articles necessary for the production of cement are secured from sources within the Irish Free State or regarding the extent to which he considers it advisable that nationals of the Irish Free State should be employed in these factories. He may also lay down conditions, somewhat in the same manner, Senators will remember, as were laid down in the Control of Manufactures Act, which, in this particular respect, this Bill follows: he may also lay down conditions regarding the amount of capital which it is necessary to have in the business and the amount provided by Irish Free State nationals. He may also lay down conditions regarding the management of the business and to ensure that the management should, so far as possible, be in the hands of Irish Free State nationals, but the most important conditions, perhaps, that the Minister will seek to attach to whatever licences he may grant are those regarding the nature and quality of the cement manufactured and the maximum price which may be charged for cement manufactured at each factory.
We had been asked to put in this Bill a standard specification, laying down exactly the quality of cement which it would be necessary to produce in order to get a licence, because, as Senators will realise, the price fixed and the price which the Minister must agree to and which will be laid down in the licence will largely be regulated by the quality and nature of the cement to be produced. It is hoped, however, that the question of the specification of the cement will be dealt with in subsequent regulations and it has not been thought advisable to lay down the standard specification at this juncture in the Bill itself. Therefore, the safeguard that we have, with regard to the price of cement, is that the quality of the cement and the price charged will be such as the Minister agrees to.
There are various other conditions which he may attach to the licence for the manufacture of cement, but these, I think, are the most important. I wish, therefore, to emphasise this fact that we do not anticipate, if this industry is established and the factories are got going, that the price which will be fixed and which the Minister will have to sanction will be the same as the price which now rules in respect of the Irish Free State market. It is anticipated that the price will be somewhat higher. It would not be an economic proposition for people to come in here and invest large sums of money under present conditions. I believe that the capital necessary in respect of each factory might run up to £500,000. Something between £400,000 and £500,000 has been stated as the amount of capital necessary and, obviously, it would be impossible to get cement manufacturers to undertake the business unless they had some security in regard to unfair competition and unless there is some guarantee that they can make a reasonable profit and that they are going to cover their costs of production and their usual expenses. The Minister must, therefore, be satisfied as to the price before he grants the licence. It is anticipated that the price will increase but not to a very great extent, but that there will be a gradual increase during the period between the time when the Bill becomes law and when the cement factories are capable of producing our total requirements.
In the event of a person, to whom a licence has been granted for the manufacture of cement, breaking any of the conditions laid down by the Minister, he will be subject to a penalty not exceeding £100, plus a fine not exceeding £50 for every day during which the offence of breach of the conditions laid down in the licence continues and, under another section of the Bill, the Minister has the additional power to revoke a licence which has been granted, if he is satisfied that the conditions have not been observed.
Parts III and IV of the Bill are somewhat novel. They deal with the compulsory acquisition of land for the purpose of cement factories and for the purpose of certain transport works which have to be set up in connection with the running of these factories. We are very anxious to have the factories established at the earliest possible moment and we thought, when we were putting these proposals before the Oireachtas, that it would be advisable to include this provision for the acquisition of land because, normally, of course, as Senators know, it would be necessary to proceed by way of private Bill, to have hearings in committee, and there might be some vexatious delays and vexatious claims made which would tend to hamper the quick establishment of the industry. I think that, within these two Parts, consistent with getting the industry established as soon as possible and removing the danger of vexatious delays or hindrances, we have given fairly appropriate safeguards. The Minister, for example, if an application be made to him for an order making compulsory the acquisition of certain lands, has to consider any representations that will be made to him in connection with the application and may not come to a decision within six weeks. If it is found impossible to reach agreement regarding the compulsory acquisition of the land, the matter is referred to an arbitrator in the same manner as is provided under the Acquisition of Land (Assessment of Compensation) Act, 1919. In addition to that, all orders made by the Minister in respect of compulsory acquisition of land or in connection with the provision of facilities for transport works will have to be laid before both Houses of the Oireachtas, who may annul the orders if they see fit. I think these two Parts of the Bill will be recognised as being necessary for the establishment, at the earliest possible moment, of the industry.
Part V is an important part of the Bill and it deals with the second matter of licences. The first matter, as I have pointed out, is the question of the licence for the manufacture of cement. The Minister may grant a licence for that purpose and may attach certain conditions. I have given the Seanad an outline of some of the conditions and all the conditions are set out in Section 12. Part V deals with the licences for the importation of cement. It would be very anomalous if the cement factory were established, capital invested in it and the industry got going in a particular part of the Free State, that, within the area served by that factory, cement importation should be allowed to continue. At the present rates, it would be impossible for the factory to compete and the Minister seeks power here to restrict the importation of cement and to grant licences to importers provided that certain conditions set out in Section 30 are fulfilled. The Minister will, during the period which must elapse before we are able to supply our total requirements from home sources, be prepared to grant licences but he will endeavour to see that, in whatever steps he takes in connection with the matter, he will not interfere with the success of a particular factory serving a particular area. This has been a rather troublesome matter and it is difficult to set up suitable machinery which, while allowing persons who cannot procure cement from the factories to import it, will, at the same time, achieve the end desired by the Minister, that is to say, will not interfere with the success of these new factories, but it is believed that by granting these licences, on which a fee will be chargeable in accordance with the amount of cement that is being imported, the difficulty will be overcome. A fee will definitely be charged on each licence in proportion to the total tonnage of cement which it is proposed to import. It is thought that, in the beginning, the fee will be something like 6d. per ton on foreign cement and 5/6 per ton on British cement.
During the 18 months when the factories are being established and the industry set up, these fees may be increased, because, as I have already pointed out, we have to face the fact that the price of cement will increase, but it is not anticipated that it will increase to a very substantial degree. I am not in a position to state definitely what figure cement will, in fact, be produced at in the Irish Free State. There is the question of quality and the question of the specification which have yet to be dealt with. There is also the fact that, although the Government has been in consultation with groups—I think there are two definite groups interested—and proposals have been handed in to the Minister of Industry and Commerce, nothing in the way of a definite decision has yet been reached, so that it would be impossible for me to tell the Seanad at the moment what the ultimate price of cement will be. I can only say that it is anticipated that the price will be something over 32/- per ton. It may be 34/-, or it may be 36/-. I cannot give a definite figure. But, I think that we can take it that it will be over 32/-, and that cement imported into the country, pending the setting up of these factories, will have to pay a fee which will be regulated according to the amount of cement imported and regulated also in view of the ultimate price which the Minister will shortly be in a position to announce. But for the first three months it is thought that the fee will be nominal: 6d. a ton on foreign cement, and in the case of British cement, on account of the emergency duties which we have imposed, something like 5/6.
It will be stated probably in opposition to these proposals that they tend to increase the cost of housing. They do, but from the inquiries I have made, I think the increase is very small indeed. I have been told that even a 4/- increase in price would only mean a very small, an almost infinitesimal, increase in the cost of the production of a single house. Under this Part of the Bill the Minister reserves to himself the right to refuse to grant licences for the importation of cement. There must be a certain amount of discretion left to the Minister in view of the fact that we have got to give these factories an economic basis to work on, but, consistent with that general plan and general policy, it will be the duty of the Minister to see that the price of cement is properly regulated; that the quality is of the highest standard possible, and that the price is as moderate as may be. In connection with these licences for the importation of cement, the full particulars regarding each particular import licence will be published in the Iris Oifigiuil.
With regard to the factories I should also say that their allocation will depend largely upon the arrangements made by the cement manufacturers themselves. We know definitely that it is their intention, if these proposals go forward, to set up factories in areas where consumption is large and where they will be near a market. If one factory is established in the east and one in the south of 100,000 tons output in each case that will be sufficient to cater for our present requirements. Later on, if the demand for cement increases we may have a third factory which I hope may be allocated to the western area. The amount of employment estimated for the two factories in the east and south is something between 400 and 500 men employed directly. There will, of course, be other advantages. Employment will be given in connection with transport and distribution: in fact probably more employment will be given in the distribution of this cement from inland centres than is at present given in the distribution from the ports. The cement will have to be distributed from two or three centres, and Senators will recognise that a good deal of indirect employment will be given in addition to the direct employment in the factories themselves. I think these are the main points in connection with the Bill.