Job Losses.

Thursday, 16 December 2004

Ceisteanna (5)

Brendan Howlin

Ceist:

5 Mr. Howlin asked the Minister for Enterprise, Trade and Employment if his attention has been drawn to the serious economic difficulties facing the Mitchelstown and north Cork area as a result of the decision of a company (details supplied) to shed 1,000 jobs and its proposal to transfer administrative staff to a new centre close to Cork city; the results of his recent meetings with the company management and business and community representatives from the area; if he will elaborate on his suggestion that the industrial base of Mitchelstown must be diversified; if he has specific proposals in this regard; and if he will make a statement on the matter. [33884/04]

Amharc ar fhreagra

Freagraí ó Béal (13 píosaí cainte)

Mr. Martin

I am very much aware of the current situation in Mitchelstown and north Cork generally. I visited the town on 12 November last when I had meetings with the company in question, union representatives and local business and community interests. I had a further meeting with the chief executive officer of the company on 6 December last.

The company in question is restructuring, which is necessary to maintain the viability and profitability of the company and to continue to provide significant employment in the area. It has also, however, necessitated significant job losses over the past 12 months, 500 of them on a voluntary basis. I have had a full and frank exchange of views with all the interested parties and I will continue to keep very much in touch with the developing situation.

On a day to day basis, the industrial development agencies are actively involved in promoting Mitchelstown and north Cork generally for industrial development. IDA Ireland markets north Cork, including Mitchelstown, as one area. A business expansion scheme building has been completed in Mitchelstown and is being actively marketed. The current primary focus of IDA Ireland is nearby Fermoy where a new business and technology park is being developed. Enterprise Ireland is working directly with the company in question both as regards rationalisation and future plans for the company. A capital grant of €200,000 has been approved by Enterprise Ireland for a food enterprise centre in Mitchelstown.

As regards the industrial base in Mitchelstown, I am concerned at the over-reliance on the food and dairy sector. I would like to see the industrial base broadened and expanded to include other industries. I have asked the development agencies to see what can be done in this regard. The initial priority is to secure inward investment for the country as a whole in an environment where we are competing against other countries for decreasing investment volumes. The location within Ireland is a consideration for each project on a case by case basis.

A socio-economic study of Mitchelstown is under way. It is being funded by local interests, including the company in question. An independent chairman has been appointed to facilitate the drafting of a plan for the area. An interim report is due in February 2005. I will continue to be actively involved in the future development of the Mitchelstown area.

Mr. Howlin

I have a number of questions arising from the Minister's reply. Will he accept that north Cork and Mitchelstown in particular is an economic blackspot? There are a number of such blackspots, notwithstanding the overall good economic and job situation in the country, which need specific attention. Has he any proposals to deal with areas, even within the so-called developed regions, that have been extremely hard hit by the contraction of traditional industries.

As regards Mitchelstown in particular, when will the socio-economic study the Minister mentioned in his reply be available? What specific steps has he taken to achieve the diversification of employment that he has indicated should happen to lessen dependence on the food sector for Mitchelstown? As regards the movement of jobs from Mitchelstown in north Cork, to the business park at Cork Airport, has he any views on the migration of employment from areas that need jobs most to places which might need them as much and has he any serious plan to lessen inducements for that type of migration and ensure that it cannot happen?

Mr. Martin

I do not like to use the term "economic blackspot". Taking north Cork in its entirety, I do not accept that it is an economic blackspot. I accept, however, that the region has suffered significant job losses, out of proportion to the average trend across the country. I also accept the Deputy's basic point that there are certain areas of the country that have not benefited as well as other regions or area in the context of a relatively robust national employment scene, and that this requires specific attention. I have asked both IDA Ireland and Enterprise Ireland as well as the enterprise boards to work together with FÁS on the training side, to examine the profiles in each of these areas. That is important as regards the demographic and skills profiles and so forth for identifying the type of interventions that may be made to support those areas. In terms of foreign direct investment, I would like to see the focus placed on companies to locate in these areas, if possible. That might require the State to ensure that certain facilities are put in place in those areas to facilitate such initiatives, as regards educational and infrastructural aspects. I ask Enterprise Ireland to work with indigenous companies in these regions to see if they can enhance their value-added output. In the case of Mitchelstown, I believe there is significant potential on the food side, linking Dairygold with Moorepark research centre and UCC, we believe synergy can be achieved which would allow new products to be developed. That would obviously be attractive on the export side and in particular on the nutraceutical side, that is, the development of foods with a strong health content and impact in terms of probiotics and ingredients that are beneficial to the body. We believe there is a significant potential for such development in the Irish food industry generally, but not least in the Dairygold area in Mitchelstown.

In terms of the movement and migration of jobs, I was not happy with the decision to relocate the headquarters from Mitchelstown to the airport business park. I communicated that to the CEO of the company. He replied that there were compelling and economic reasons in terms of a deal that was on offer, apparently, in the context of the business park. I understand Cork County Council had difficulties with it because that business park was more for——

Mr. Howlin

Aviation.

Mr. Martin

Not just aviation, but more for FDI-type projects.

Acting Chairman (Mr. McCormack)

The time for priority questions has concluded.

Mr. Martin

I wanted to respond to the issues raised by the Deputy. I have been to Donegal and will visit the other area to review their situations.

Mr. Howlin

Will the Minister visit Wexford, too?

Mr. Martin

It is on my itinerary.

Mr. Howlin

I thank the Minister for his reply as regards Mitchelstown. He did not come back on the socio-economic study, but perhaps he will communicate when that is available. In terms of the division of the country into two regions, one notionally developed and the other under-developed, will he accept that this is not an accurate reflection of Ireland now and that within the so-called east and south region there are blackspots that need a focused attention?