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Dáil Éireann - Volume 235 - 25 June, 1968

Committee on Finance. - Vote No. 40—Industry and Commerce.

Minister for Industry and Commerce (Mr. Colley): Tairgim:

Go ndeonófar suim nach mó ná £10,862,000 chun slánaithe na suime is gá chun íoctha an mhuirir a thiocfaidh chun bheith iníoctha i rith na bliana dar críoch an 31ú lá de Mhárta, 1969, le haghaidh tuarastail agus costais Oifige an Aire Tionscail agus Tráchtála, lena n-áirítear seirbhísí áirithe atá faoi riaradh na hOifige sin, agus chun Ildeontais-i-gCabhair a íoc.

Feidhm tábhachtach de chuid na Roinne se' agamsa fós isea misniú lucht tionscail agus cabhrú leo iad fhéin a ullmhú fá choinne saorthrádáil. Ag an 30 Meán Fomhair, 1967, an dáta deireannach le hiarrataisí a glacadh le haghaidh deontaisí d'oiriúnú agus d'athghléasadh, bhí tuairim is 2,000 iarratais faighte agus díobh seo ceadaíodh 1,400. Ar bhonn na ndeontaisí ceadaithe sroisfidh infheistiú réamh-bheartaithe i bhfoirgnimh, i bhfearas agus i ngléasra thart faoi £96 milliún. Sí £21 mhilliún iomlán na ndeontaisí ceadaithe faoi choinne seo agus den mhéid sin, íocadh £9.4 milliún cheana féin.

Níl i gcur in oiriúnt don aois seo de ghléasra agus i bhfeabhsú agus i bhforbairt foirgnimh ach gné amháin d'oiriúnú. Tá an oiread céanna tábhachta ag baint leis na gnéithe neamh-ábhardha d'oiriúnú. Níl an dul chun chinn atá déanta againn in aon ghar den mhéid ar chóir bheith déanta againn. Tá mé ag smaoineamh ar an gceist fíor-thábhachtach sin, cóimheasú, pé acu an trí chumascadh agus chónascadh nó trí fhoirm níos scaoilte díolaíochta nó táirgeadh a bhunú idir chomhluchtaí a déantar é.

I rith na bliana seo chaite mhéadaigh an tÚdarás Forbartha Tionscail ar a iarrachtaí chun tionscal nua a mhealladh go dtí an tír seo agus chun bunú agus forbairt tionscail dhúchais a spreagadh. Siad na comhluchtaí nuabhunaithe atá ag cur go suntasach le [1552] leas eacnamúil na tíre faoi deara chuid mhaith den fás tapaidh a tháinig ar onnmhuirithe tionsclaíoch le blianta beaga anuas. Tá an tÚdarás Forbartha Tionscail ag tabhairt breis aire fós don fhadhb a bhaineann le forbairt thionscail dhúchais a spreagadh. Léiriú phractaiciúl ar mhian an Rialtais chun chuidiú le tionscal Éireannach isea Feachtas na Miontionscal. Sí aidhm na scéime seo atá faoi scáth an Údaráis Forbartha Tionscal, ná tionscnamh tionsclaíoch a fhorbairt agus áiseanna a chur ar fáil a chuirfidh ar chumas an miontháirgeoir a ghnó a mhéadú agus a fhorbairt.

Soláthair £8 mhilliún atá ann don bhForas Tionscal san bhliain reatha airgeadais. Faoin 31 Márta, 1968, cheadaigh An Foras Tionscal deontaisí de £56 mhilliún mar gharmheas. Íocadh £27 mhilliún den mhéid sin agus fágann san £28 mhilliún d'fhiachaibh ar an bhForas. Sí £109 mhilliún an infheistiú iomlán chaipitil atá i gceist agus meastar go soláthrófar fostaíocht do 44,000. Tá dul chun chinn fós dá ndéanamh ar na heastáit tionsclaíoch i nGaillimh agus i bPort Láirge.

Bunchoinníol d'ár bhfás eacnamúil isea méadú leanúnach ár n-onnmhairithe. Le go mairfeadh muid slán faoi choinníollacha saorthrádála, ní mór táirgeadh tionsclaíoch atá ag fás a bheith againn agus tá an fás seo, ag brath ar fás ár n-onnmhairithe. Ceann de na nithe faoi deara an fás ins na honnmhairithe i 1967 ab ea breis ghníomhaíocht co-oibritheach na n-onnmhaireoirí faoi scáth Córas Tráchtála.

Tá forbairt sásúil dá ndéanamh ar na fionachtanna tabháchtacha mianraí go dtí seo. Tá dul chun chinn sách maith déanta i dTighneatha i gContae na Gaillimhe agus i nGortdrum agus Béal Átha Gobhann i gContae Thiobraid Árainn. Is dóichí go dtuillfidh onnmhairithe óna mianacha san breis is £10 milliún faoi 1970. Chuir an méadú i dtaiscealadh agus i bhforbairt mianraí treise leis an gá atá ann atheagrú a dhéanamh ar an Suirbhéireacht Geolaíoch chun go mbeadh ar a chumas an fhreastail speisialta is gá chun go leanfadh an forbairt mianrach seo. Ceapadh Stiúrthóir nua agus [1553] táthar ag leanúint den atheagrú chomh tapaidh agus is féidir.

In the Book of Estimates the net Estimate of £10,862,000 for the year 1968-69 compares with a sum of £10,867,010 granted in 1967-68, including Supplementary Estimates for a total of £2,784,010, and shows a decrease of £5,010.

The principal increase arising in the financial year 1968-69 is in the provision for An Foras Tionscal which is greater by £252,480 than the sum provided in 1967-68. The provision for An Foras Tionscal in 1968-69 is the same as that in the main and supplementary estimates for 1967-68 approved by this House in November last. It was subsequently found that for reasons outside the control of An Foras Tionscal, the full amount of £8,000,000 provided in 1967-68 would not be required, and some £252,480 was used as savings for the third Supplementary Estimate taken on 6th March last. There is an increase of £120,000 in the provision for the Institute for Industrial Research and Standards; £105,250 in the provision for Departmental Salaries and Wages; £68,000 in the provision for Córas Tráchtála; £77,500 in the provision for the National Productivity Year, and £38,400 in the provision for the Industrial Development Authority. Minor increases in other Subheads amount to £8,369 bringing the total increases in expenditure to £669,999.

There are decreases in expenditure under a number of subheads in 1968-69. The provision for Technical Assistance is down by £58,000 on the 1967-68 provision which included a Supplementary Estimate of £60,000. There is no provision this year for flour millers' losses, for which £137,000 was provided last year by way of a Supplementary Estimate. There is only a taken provision of £10 this year for Temporary Assistance for Industry as compared with £320,000 in 1967-68. A token provision of £10 has been provided again this year for Castlecomer Collieries Ltd., for which service a Supplementary Estimate for £64,990 was approved last year. The grant to the Irish National Productivity Committee for general expenses has been [1554] reduced by £20,000. Other minor decreases amount to £6,130 bringing the total decreases to £606,110 to which must be added an increase of £68,899 in Appropriations in Aid giving a total of £675,009. The net decrease in the Estimate is therefore £5,010.

The task of encouraging and assisting industry in its preparation to meet conditions of free trade continues to be an important function of my Department. The time limit for making applications for adaptation grants has now terminated. The scheme has been in operation for a period of six years. Up to the final date — 30th September, 1967 — over 2,000 applications for grants were received, and of these 1,400 have been approved. On the basis of grants approved, planned investment in buildings, plant and machinery has been of the order of £96 million. The grants approved towards this total amount to almost £21 million.

The acceleration of activity in 1966, which I mentioned in my Estimate speech last year, was continued in 1967 — the cumulative figure of 1,400 approvals already mentioned showing an increase of 600 over the corresponding figure up to 31st March, 1967. The total of adaptation grants paid to 31st March, 1968 amounts to some £9.4 million or nearly 45 per cent of approvals. These figures indicate that a substantial amount of physical adaptation has been and is in course of being carried out. It must, of course, be recognised that in many cases there will be a substantial time lag between the approval of and the completion of an adaptation project. Delivery of machinery, for example, can take up to 18 months.

When the total capital expenditure already mentioned has been completed I think we can fairly claim that the crash programme of short-term physical adaptation envisaged by the CIO will have been completed. This, however, must clearly be seen as a catching-up phase only. Technological developments, new production techniques and different marketing situations in both home and export markets call for a Committee and the Institute for Industrial [1555] Research and Standards. constant process of change if our manufacturers are to achieve and retain competitiveness with their opposite numbers abroad. No industry is in a position to say that further adaptation is unnecessary for it. I have had one or two reports which indicate that some industries may be losing their sense of reality in this matter. I would urge on all concerned with adaptation in industry to regard whatever has been achieved as an initial base on which we must continue to build each year. Competition from imports is an inescapable part of free trade; the task of Irish industry for the future is to equip itself fully to meet this competition.

Modernisation of equipment and expansion and improvement of premises constitutes, of course, only one aspect of adaptation. The non-physical aspects of adaptation are of equal importance, and in this regard, as I have frequently had occasion to point out, we have not made anything like the progress we should have achieved. I have particularly in mind the all important matter of rationalisation whether it takes the form of mergers and amalgamations, or the looser form of inter-firm marketing or production arrangements. The Industrial Reorganisation Branch of my Department which is in close and continuous contact with industry at both sectoral and firm level, is giving special attention to these matters. In particular, officers of the Branch are endeavouring in the course of their contacts to identify situations in which mergers and amalgamations could usefully contribute to the overall strength and efficiency of an industry. Where there are prima facie indications of the existence of such a situation the firms concerned are advised and encouraged to seek specialist advice as to the feasibility of the suggested development. The Branch also makes every effort to promote joint activity in relation to marketing and other matters and encourages firms and, where appropriate, Adaptation Councils for industry, to make the fullest use of the services of agencies such as Córas Tráchtála, the National Productivity [1556] Committee and the Institute for Industrial Research and Standards.

It has been said many times before but I feel that it can bear repeating that the main responsibility of preparing for free trade rests with industry itself. The Government have, through various schemes and aids, provided the means by which manufacturers can help themselves, but these will be of little avail if all concerned do not display and bring to bear on their day-to-day activities the determination to maximise their resources and improve their competitive efficiency to the fullest extent.

While I shall continue to lay great stress on the need to make our industry as strong and efficient as possible, I do not intend to neglect distribution, or the other services for which I am responsible. It would be a great mistake to suppose that freed trade poses a threat to the manufacturer only, and that the trader can feel secure of staying in business come what may. Modern developments require a response of initiative and adaptability from commerce no less than from industry, and it will be my concern to help those who are trying to help themselves. I have no intention of trying to bolster up the inefficient against the efficient, but neither do I propose to permit those who have made themselves efficient to be put out of business by unfair trading methods. In the interests both of distributors themselves and of the consumers, the efficiency of the distributive sector must be raised as high as possible.

During the past year the Industrial Development Authority intensified its efforts to attract new industry from abroad and to encourage the establishment and expansion of home-based industries. Promotional campaigns involving both myself and board members as well as senior staff of the IDA were undertaken in a number of countries which appeared to offer good prospects. In 1967, 62 new industrial enterprises commenced manufacturing operations; 44 of these had external participation and accounted for 80 per cent of the estimated capital investment of £14.7 million and of the employment potential of 4,300. In addition, there were 26 new factories under [1557] construction at the end of the year and these involve capital investment of the order of £8.9 million and employment of 2,100 at full production. The rapid growth in industrial exports in recent years is due in large measure to the new firms established which are making an invaluable contribution to the nation's economy and have broadened our industrial base. This development in exports is all the more meritorious when regard is had to the rather depressed market conditions which prevailed in our main export outlet.

The Government appreciate that any worthwhile increase in the labour force must be generated principally from the expansion of the industrial sector and we look to the foreign enterprises to provide a significant proportion of this increase. The restraints on overseas investment imposed by the British and American Governments are certainly no help in our endeavour to quicken the tempo of development in industry. I have recently made representations to the United States authorities about the retarding effects which these constraints are likely to have in respect of United States involvement in assisting the growth of our economy and I am hopeful that action will be taken to alleviate the position in so far as industrial investment is involved. Arrangements have been made to ensure that, in the case of any sound industrial project, and shortfall arising from the restrictions by the United States Government on foreign investment will be met by finance from Irish sources.

In this connection, I am very happy to commend the ready response of Irish financial institutions to approaches made to them by the IDA. The wide range of financial incentives and facilities available for the establishment of manufacturing plants here, including the availability of ready-built factories at subsidised rents, should help to modify the impact of external investment restrictions. Furthermore, the expansion of the services of the industrial credit company and developments in the Irish banking world, resulting in the creation of new financial institutions specially geared to provide loan capital for industrial development, [1558] are particularly welcome at this stage and should be of assistance in meeting the problem.

In these circumstances, the review of the country's industrial incentives which has been taking place for some time past in the light of a report furnished by a leading international firm of consultants and of the findings of a report on a survey of grant-aided industry, is most opportune. The Government have now examined in detail the proposals which have been formulated for improving our “mix” of incentives and facilities to industry. I hope soon to provide Deputies with a report on the conclusions of the consultants engaged to contribute to the review of measures for industrial and related developments.

As already announced by me, it is intended that An Foras Tionscal will be merged with the Industrial Development Authority. The extended Authority will have the existing powers of both bodies and, in addition, resources of itself and in co-operation with other bodies to offer wider incentives and facilities for industrial projects. The details of these facilities will be set out in legislation to be introduced by me in due course.

As I have already announced, a new scheme of grants for re-equipment involving modernisation or improvement or expansion is being introduced. Under the scheme, approved expenditure on premises or equipment from 1st March, 1968, will be eligible for consideration for grant assistance at the rates of 35 per cent in the undeveloped areas and 25 per cent in the rest of the country excluding Shannon. The differentiation in grant levels is in line with the higher grant levels provided under the industrial grant scheme for new industrial development and is a reflection of the Government's policy of giving special assistance towards resolving the problems of the West. The processing of applications for assistance has already been put in hand in advance of the enactment of the necessary legislation. The new grants scheme is a recognition of the fact that industrial adaptation is a continuing process and of the tendency for adaptation measures to [1559] become more sophisticated and expensive. Re-equipment grants are available to industry in Northern Ireland and Britain and I am conscious of the need to ensure that Irish manufacturers do not suffer from any disadvantage in the matter of State aids with their main external competitors.

The IDA has been devoting increasing attention to the problem of stimulating the development of native industry and is doing its utmost to encourage Irish enterprises to expand or branch out into new activities. It has initiated an advertising campaign to bring to the notice of Irish manufacturers the many aids that are available to help them to expand. The Small Industries Programme under the auspices of the IDA is another practical example of the Government's interest in helping Irish industry. This scheme, which has been in operation on an experimental basis in selected areas for the past year, is designed to encourage industrial initiative and to provide facilities to enable the capable small producer to develop and expand. Encouraging progress has been made in the implementation of the scheme and this augurs well for the future. It is hoped to formulate proposals for the extension of the scheme throughout the whole country at the end of the programme test period which is about six months hence.

When introducing last year's estimate I referred to my anxiety that adequate measures should be taken to ensure that our native resources should be used to the maximum extent as the basis for new enterprises. I am very glad, therefore, that our plans in this regard have made significant progress. I announced recently that an eminent firm of international consultants had been engaged to advise the IDA on the direction development should take in the light of advanced technology. This firm has been asked to have particular regard to industries which could be based on our own resources.

The provision for An Foras Tionscal in the current financial year is £8 million, which is substantially the same as that provided last year, taking into account the Supplementary Estimate [1560] for £2.5 million taken with the main Estimate for my Department in November last. Actual payments made by An Foras Tionscal in 1967-68 amounted to £7 million approximately made up of —

£m.

(1) Grants under the undeveloped Areas Acts

1.03

(2) Grants for projects outside the Undeveloped Areas

2.04

(3) Adaptation Grants

3.26

(4) Industrial Estates

0.67

Up to 31st March, 1968, An Foras Tionscal had approved grants amounting roughly to £56 million of which some £27 million has been paid. Outstanding commitments at 31st March last amounted to £28 million. In addition, up to 31st March, 1968, expenditure on the development of industrial estates amounted to over £1 million.

The total capital investment required for all new projects both in the undeveloped areas and elsewhere amounted to £109 million and it is anticipated that employment will be provided for about 44,000 persons.

The development of the industrial estates at Galway and Waterford continues to make progress. Factories for renting are now available at Waterford and the first factories will be available at Galway in August next. This should be a major inducement to industry to come to these centres. The availability of ready-built factories for renting can be an important aid to existing industrialists wishing to develop, but prevented from doing so by the inadequacy or unsuitability of their existing premises.

I have already announced that in the Government's view it would be beneficial to avail of the successful experience of the Shannon Free Airport Development Company Limited within the Limerick/Clare/North Tipperary Region. Accordingly, it has been decided that the company will function as an organ of industrial development within this region. The Company will report to me on all industrial and related matters, including those at the Shannon Industrial [1561] Estate, but will continue to be responsible to the Minister for Transport and Power on its tourism and aviation activities.

I have spoken earlier of the urgent need for the adaptation of industry to new conditions. Perhaps nowhere is this need more urgent than in the field of technology. The course which our industrial development has historically taken has unfortunately left us with a legacy of comparatively backward technology. It is a pleasure to acknowledge that there are some shining exceptions to this rule, but over the greater part of the industrial spectrum there is, unfortunately, a noticeable weakness in this field. The importance which the Government attach to the place of science in our economy as a whole is evidenced by the establishment some months ago of the National Science Council, from which I hope to receive valuable help in the framing of policy towards science in industry. The Institute for Industrial Research and Standards has been at work in this field for some years, and I intend to provide it with funds which will enable it to extend and intensify its activities in the years to come. Nothing that Government or State bodies can do, however, will be a substitute for action by individual managements. The State and its institutions may be able to lead industry to the water of technological progress but they cannot make it drink. It is essential that a more lively awareness of the need for technological progress should be developed amongst Irish industrialists.

The Institute for Industrial Research and Standards has, of course, been the principal instrument available to me to promote higher standards of technology in industry. The Board of the Institute has submitted to me a five-year plan for expansion in the years 1968 to 1973. The plan has emerged from consideration by the Institute, in the light of experience of its operation since the reorganisation in 1961, of the report “Science and Irish Economic Development” prepared by the Research and Technology Survey Team, in association with OECD, and the review of the activities of the Institute carried out by the international [1562] consultants, Arthur D. Little, Incorporated. The plan envisages considerable expansion in the Institute's technical facilities and the involvement of the Institute in new fields of activity on an increasing scale over the next five years.

Before coming to decisions in regard to the plan, I decided to seek the views of the National Science Council. I am satisfied, however, that even though a final decision in regard to the plan may not be possible for some time yet, further expansion of the more important facilities provided by the Institute to Irish industry should not be hampered for want of funds. I have, accordingly, decided to provide for a grant-in-aid of £500,000 in this financial year, which is an increase of £120,000 over the 1967-68 figure.

The Government have long been aware that firms need help to make the necessary changes to meet freer trading conditions and the technical assistance grants scheme continues to be available to firms who are taking the necessary steps to increase efficiency.

For the same reason, substantial financial support is given to the Irish National Productivity Committee and the Irish Management Institute. The tripartite constitution of the INPC representing management, labour and educational interests recognises that productivity increases will best come with the co-operation of all those interests. The IMI is carrying out very valuable work in the education of management which bears special responsibilities and meets special problems in the organising of industry. In addition, the Government have approved the running of a National Productivity Year commencing in September, 1968, so as to increase the consciousness of the need to make better use of our resources of finance, skill, materials and equipment. The promotion of the Year is being undertaken under the charge of a Steering Committee which is representative of the principal sectors of the economic life of the country. As increased productivity benefits all sectors I confidently appeal to all leaders in the community to lend their support to the organisation of National Productivity Year.

[1563] Continuing expansion of exports is still a key factor in our economic growth. Survival in conditions of free trade, coming steadily nearer, demands a growing industrial output and this in turn, especially in our circumstances, depends on expansion of exports. The smaller the country the higher the proportion of its output which must be exported to enable industry to pay its way and to build up its work-force. It is in this sense that the growth which took place in our economy in 1967 was export-led and it is for this reason that the trade figures for 1967 are so encouraging.

Total exports amounted to £314 millions, when exports from the Shannon Free Airport Estate are taken into account. This in itself is a record and the increase of the total of industrial exports, again including Shannon area, by £20 millions to £148 millions is the most significant feature of the achievement.

This must be regarded, however, merely as a good beginning. The effort must be continued and intensified and exporters must be urged to make the fullest use of the services provided by Córas Tráchtála.

Among the factors contributing to the export expansion in 1967 was the increased co-operative activity by exporters under the auspices of Córas Tráchtála. This included overseas trade fair participation, department-store promotions and sales displays in Córas Tráchtála's offices abroad. A greatly extended programme of overseas trade promotions has been planned for 1968 including further store promotions in the United States, Britain and Australia.

The encouragement of market diversification has always been part of the policy of Córas Tráchtála and devaluation of sterling in November last gave additional impetus to this policy. The official opening of Córas Tráchtála's new office in Australia was an important step in this direction and it is planned to further this by organisation of group selling missions to the Australian market during 1968. The Board have also recently announced the proposed establishment of a fulltime [1564] Paris office in the autumn of this year. An important undertaking by Córas Tráchtála in 1967 was the launching of the New Exporters Programme which aims at bringing into the export field as many as possible of the 1,300 firms not yet exporting. The Programme is based on careful preliminary research and is designed to bring to the notice of such firms, and to help them to utilise fully, the various services already available to exporters from Córas Tráchtála and to place at their disposal special extra services and facilities suited to their particular needs. This Programme is a vital step in the preparation for free trade, both from the point of view of the firms concerned and of the economy as a whole.

The importance of good design in industry can hardly be over-stated, particularly in this country where we are likely to find out best export markets in goods of high quality and known excellence. Design and proto-typing services are provided by Kilkenny Design Workshops in woven and printed textiles, silver and metal work, ceramics, candle-making and wood turning and these services are being increasingly used by industrialists. Major store promotions of Kilkenny designed products in New York and London during 1967 emphasised the importance of Kilkenny Design Workshops' role in raising the standard of industrial design and in establishing the reputation of this country's goods abroad.

Our prospects of early entry to the EEC have receded somewhat as a result of the failure of the Six member states of the Community to reach agreement on the opening of negotiations for the accession of the applicant countries. As Deputies will be aware, efforts have been made within the Community to find an agreed basis for an interim arrangement with the applicant countries, pending ultimate membership. These efforts have also encountered difficulties and at this stage it is not possible to say what will emerge from these discussions or what could be achieved by way of an interim arrangement. In any case our application for membership remains on the agenda of the Council of Ministers and the matter of our accession will [1565] continue, therefore, to be a live issue.

Following approval by Dáil Éireann, Ireland signed the Protocol of Accession to the General Agreement on Tariffs and Trade on 22nd November, 1967, and became a full member of that Organisation on 22nd December, 1967. In our future trading arrangements, we will have to have regard to the rules of the GATT. Membership of the GATT, however, confers significant benefits, notably the fact that it gives us a contractual right to all the tariff reductions and trade liberalisation negotiated in the GATT since its inception.

By far the most important of the trade negotiations undertaken in the GATT was the Kennedy Round which was completed last year. The outcome of the Kennedy Round was that the principal participating nations, including the United States, the EEC, Britain, the EFTA countries and Japan, agreed to reduce duties on most industrial products by an average of 35 per cent over the next four years. The remaining developed member countries including, for example, Canada, agreed to make somewhat smaller reductions in the same period on a less extensive range of products. The commitments made by countries other than Britain should, as they become effective, prove of substantial benefit to Irish exports of industrial products. They will provide our exporters with greater opportunities for expanding their business in traditional markets outside Britain. They should also have the effect of creating export possibilities for products which are at present not being exported in significant quantities and of stimulating exports to countries where our existing trade is relatively small.

There has been a marked increase in interest in minerals exploration during the past year. New applications for prospecting licences numbered 450 and more than doubled the figure for the previous year. There were 480 licences current at 31st March, 1968. Expenditure on current prospecting is estimated at £400,000 per annum.

Development of important discoveries to date is proceeding satisfactorily. The year 1967 was one of considerable [1566] progress for the lead/zinc/silver mine at Tynagh, County Galway, which commenced production at the end of 1965. The tonnage of ore treated in 1967 totalled 703,511 as compared with 545,693 in 1966. Concentrate output increased from 121,564 tons in 1966 to 190,985 tons. The feasibility of a tailings treatment plant to recover barite, copper, silver and lead from the tailings is under investigation. Exploration has disclosed a new ore body and the total reserves of the mine are now estimated as sufficient for 17 years of operation at the current milling rate. The Company estimated that royalties payable under the State Mining Lease for the year 1967 will exceed 700,000 Canadian dollars as against 420,000 for 1966. Production commenced at the copper/silver deposit at Gortdrum, Co. Tipperary in July, 1967, and at the lead/zinc mine at Silvermines, County Tipperary in mid-May, 1968. Promising lead/zinc deposits at Keel, County Longford are still under detailed investigation.

Exports from these mines are likely to amount to over £10 million by 1970 and further expansion may be expected from deposits likely to be disclosed by the intense exploration now taking place. Direct employment in mining is expected to reach 1,300 by 1970. The State will also benefit by increased revenue from royalties and dead rents.

The Consortium, which were granted in 1966 an option for a total period of 30 months to purchase the assets of St. Patrick's Copper Mines Ltd., Avoca, are continuing their feasibility study of the mine's potential with a view to resumption of operations. They have not yet indicated whether or not they propose to exercise the option.

Results of exploration for petroleum and natural gas within the State carried out by Marathon Petroleum Ltd. have not been encouraging. Activities in the past year were confined to a thorough re-examination of all geological and geophysical work conducted to date in order to determine the most prospective areas for oil and gas.

The increase in mineral exploration and development in recent years has highlighted the need for an adequate Geological Survey to provide the [1567] specialist services necessary in connection with this work. Considerable difficulty has been experienced in recruiting and retaining the necessary technical personnel for our Survey but a new Director for the Survey has been appointed and the steps necessary for the re-organisation and expansion of the Survey to meet present and future needs have been decided upon, and are being put into effect as rapidly as possible.

The Government have already decided to extend for a further period the operation of the Prices Stabilisation Order, 1965, and I will continue to exercise my functions under the Prices Acts to ensure that there are no unjustified price increases during the present year.

I need hardly emphasise the value of price stability to the economy as a whole and the continuing need to keep cost and price increases tightly in check. Recent major developments in the external scene, which have led to a very uncertain international situation, mean that we must take every care to safeguard the competitiveness of our products. The recent devaluation of sterling favours the expansion of exports to a number of markets and it is most desirable that the extra competitive edge given to Irish products by devaluation should not be lost through increases in domestic costs and prices.

I quite realise that, in certain circumstances, firms could not hope to survive without a compensatory price increase for substantial unavoidable increases in costs. However, I shall continue to expect firms to use all possible means to avoid or minimise price increases and to absorb part of the increases in costs, wherever they can reasonably do so. In this regard, I should hope that there will be an increasing consciousness on the part of both management and workers that any action which they take, through increasing productivity or otherwise, towards price stability is to their ultimate advantage and that of the whole community.

Alertness to prices on the part of the purchasers in general might also be mentioned as an essential aspect of [1568] price stabilisation. Here, too, I might re-emphasise the fundamental Government view that, in normal circumstances, there is no substitute for free and fair competition. I feel that the price control measures which I have taken to date have helped to promote competition, partly through heightening public awareness to prices, and I would urge both management and workers to play their part by continuing to seek greater mutual understanding with a view to minimising production costs and restraining prices. Only by such combined efforts can we hope to meet the growing threat of foreign competition and maintain the growth of our exports.

Subsidies have been paid on ships built in Verolme, Cork, Dockyard from the commencement of shipbuilding operations. A total of nine ships have either been built or are under construction and payments are made from time to time on the recommendations of a Special Committee.

The sum provided for such subsidies in the year 1967-68 was £350,000 of which £150,000 was paid. Total subsidy payment to 31st March, 1968, amounted to £1,176,000.

The Government have approved proposals for the reorganisation of the Cork Dockyard as recommended by the Special Committee following their examination of the report of a firm of consultants on the present activities and future prospects of the yard. These proposals envisage, as well as the continuation of shipbuilding activities, an extension into ship repair work and into certain fields of general engineering work not now subject to duty.

This new scheme will involve the provision of £1,390,000 from State funds, partly by subscription for ordinary shares, partly by loans and partly by grant. It also envisages (i) the continuation of subsidy at the existing level for a further five years, when the position will again, at the latest, be reviewed and (ii) the continued waiver of interest on loans to the Company until such time as it has reached the profit stage. The waiver of interest is, of course, a form of additional subsidy. [1569] This interest amounts to some £87,000 annually and the accumulated amount waived so far is £550,000.

The works involved in the new scheme for the dockyard are already well advanced and I am confident that the implementation of these proposals will, by fuller and more effective utilisation of the manpower and equipment available, lead to optimum economic operation having due regard to the intense competition which currently confronts shipyards throughout the world.

The new scheme of grants for Irish shipowners proposed by the Minister for Transport and Power will, I hope, also afford increased opportunities for the shipbuilding industry in this country.

In January of this year, the Government issued a statement in which they drew attention to the move towards the metric system which was already beginning to manifest itself in this country, urged all sectors of the economy to prepare themselves for the change-over which would be complete by 1975, and outlined the steps which the Government were taking to promote conversion. As Minister for Industry and Commerce, I have been charged with the general overseeing of the conversion process, with the exception of the construction industry. Outside the construction industry, conditions in this country do not in general require that any rigid time-table of metrication be imposed, and I intend to a large extent to leave it to each industry or trade — and often indeed to each individual firm within an industry or trade — to time its own moves. It will be my concern, however, to ensure that a general forward momentum is maintained and, where joint action within or between groups is required, that the necessary consultations and co-operative decisions are undertaken in good time.

In my speech on the Estimates last year, I ended on an optimistic note and the record growth in exports already mentioned fully justified my optimism. Each year is creating greater opportunities for industry but at the same time an increasing threat to the survival of firms which continue to be inefficient [1570] or non-progressive. It is essential for the growth of industry that prices of the finished products remain competitive and this can be achieved only with the greatest co-operation between organised workers and efficient management.

As the Minister responsible for the future growth of industry, and, may I add, the growth of industrial employment, I feel it is my duty to refer to the recent unhappy developments in the industrial sphere. Unofficial and lightning strikes which are becoming so prevalent in this country today, particularly in the essential services, are, I fear, going to worsen the position of workers in the industrial sector. The future development of the country depends on the growth of industrial employment which in turn depends on the growth of exports.

Millions have been spent by the Government on the development of industry. Our exports depend on our ability to fulfil our commitments promptly. Any delay due to labour unrest, no matter what the cause, could result in the loss of highly competitive markets. All our efforts and investment in the past could be nullified by lack of harmony between employers and employees and the trend of emigration, which has been gradually dropping, could be completely reversed. I earnestly appeal to all parties concerned to consider the harm likely to be caused to the community generally by unofficial strike action.

In accordance with undertakings previously given to Dáil Éireann, I wish to make a statement regarding the financial assistance given by the State to Potez Aerospace Ltd., and its associated company, Aviation Development, and on the present manufacturing activities of the company.

The initial decision to provide financial assistance from State funds for this enterprise was taken in 1961. The proposal was to produce in Ireland the Potez 840 a new short and medium-range aircraft seating 16-24 people. The aircraft had not been produced commercially at that stage but three prototypes had been built in France. Independent experts who were consulted [1571] regarded the plane as a first-class aircraft. Inquiries for the plane had been received from several countries and a provisional order for 24 planes was on hands from a US company.

The State assistance proposed for the undertaking was to be provided in two ways, an investment in the development costs of the plane — in accordance with Government practice in other countries — and a grant towards the cost of the building machinery, et cetera, to be provided in Ireland. The development costs involved design, drawings, special tooling, production of prototypes, et cetera.

Following negotiations with the principals, two companies were established, Aviation Development and an operating company, Potez Aerospace Ltd. The arrangement regarding the two companies provided that Aviation Development would finance the development of the aircraft; the special tooling, prototypes, et cetera, would be the property of that company, and a State investment would be made in it. Potez Aerospace Ltd., would be the operating company, manufacturing the aircraft.

The arrangement further provided that a fixed amount of the profit earned by the operating company, Potez Aerospace, would accrue to the development company, and that no dividend would be paid to the private interests in the operating company until the amounts subscribed in the development company had been recovered.

The development costs were estimated, at the time, at £3 million, and the Government undertook to subscribe through Taiscí Stáit a maximum of £1½ million, which was the cost of the special tooling. Messrs. Potez undertook that any excess in the tooling costs would be provided by them. The construction and equipment of the factory here by Potez Aerospace Ltd. was estimated to cost £926,000 — £696,000 of which was for the construction of the factory — and a grant towards this of £463,000 was approved.

The actual amount which has been [1572] invested by Taiscí Stáit in Aviation Development is £955,105. With regard to the grant position for the operating company, Potez Aerospace, the certified expenditure on buildings, machinery and equipment amounted to £824,513, including the buildings figure at £696,000 on which the grant was based, and the actual grant that has been paid amounts to £405,000 out of the £463,000 approved. On the basis of the certified eligible expenditure, a sum of £7,000 grant is still payable to the promoters.

The total amounts, accordingly, that have been contributed by the State to this undertaking are £1,360,105, consisting of an investment of £955,105 in Aviation Development and grant of £405,000 to Potez Aerospace. There must be strong reservations as to the value of the investment held by Taiscí Stáit in Aviation Development. The extent to which State money can be recovered out of this investment is being investigated. A further statement on this matter will be made in due course.

In September, 1965, it was estimated by consultants employed by the Industrial Development Authority that by that date £4,368,000 had been spent on the project. Allowing for the contributions from the State, which at that date amounted to £1,319,900, the private promoters had spent £3,048,000 from their own resources. It is estimated that up to the present time, approximately £5 million has been spent on the project. Making allowance for the total State contribution £1,360,105, sums totalling approximately £3,640,000 have been provided by the Potez sponsors of the undertaking. This amount includes £125,000, together with certain machinery, which have been provided by Messrs. Potez to Potez Aerospace Ltd. up to the end of 1967 in connection with the company's current activities on sub-contract work.

It had been anticipated at the outset that production of the P840 would commence in Ireland towards the end of 1963 and that a production level of four planes per month would be reached in 1964, giving, at that level employment to 1,000 production [1573] workers and 700 other staff, including draughtsmen, administration, et cetera. The building of the factory was completed in 1964.

In the following year it became clear that the project was running into serious difficulties. There were financial difficulties including the steeply rising development costs to which I have referred and a substantial increase in the price at which the aircraft would have to be sold. There were difficulties regarding delay in the production of the engine on which the plane had been based, and the development of an alternative. Most important of all was the emergence of other aircraft catering for the same market resulting in the loss of orders expected for the P840.

Four of these aircraft have been produced in France and sold there but there has not been any production of aircraft in the Irish factory. In 1966, the Government decided they would not be justified in issuing any further money or continuing their support for the production of the P840 or its successor plane.

The Industrial Development Authority has been in touch with leading aircraft companies throughout the world to interest them in associating themselves with the undertaking here. Serious interest has been shown by certain extern companies in this and contacts are continuing.

Early last year a new managing director took up duty with the company. He is a highly experienced aircraft engineer, with many years top level experience in the aircraft industry both in Britain and in Australia. The company then decided to enter the sub-contract business within the aircraft industry.

The Industrial Development Authority recently commissioned industrial consultants to examine this new aspect of the company's activities and to report on immediate prospects in this respect. I can say that the findings of the consultants and the report by the Industrial Development Authority are favourable. The consultants speak highly of the competence of the new management. They consider that the company's plans to develop their existing [1574] sub-contract work for the aircraft industry are sound and that the undertaking in this respect should become profitable before 1970. The project is subject to normal commercial risk but the prospects of success are good.

The company have already done acceptable work for important external aircraft firms and over half of their sales budget for 1968 is assured. Contract work, however, is, of its nature, subject to fluctuations according as work is being phased out or taken on— indeed I understand that a number of men were let go temporarily in recent months — but there are sound prospects that the work force of 113 now employed will be built up to 250 around the middle of next year and substantially expanded later on. The company are actually starting to recruit skilled workers and expect to reach an employment figure of 150 in a couple of months.

The development of this sub-contracting work has involved the training of new workers and the acquisition of additional plant and machinery. The costs of this were carried by the private promoters of this industry until the end of 1967, and have been substantial. An application for Government assistance towards this new development was made by the company. The application was supported by budgetary information in relation to the company's programme.

It was at this point that the Industrial Development Authority commissioned the study to which I have just referred. The recommendation made by the Industrial Development Authority is that further State finance to the extent of £258,000 should be provided for Potez Aerospace Limited to enable this sub-contracting work to go forward. A small portion of this, some £7,000, represents grant moneys remaining unissued to the company under earlier commitments and the balance represents —

A grant towards the excess of £69,000 by which the actual cost of the buildings exceeded the estimate of £696,000 on which the original grant was approved;

a contribution towards the cost of [1575] the necessary additional machinery;

the extra costs arising in the work through having to train workers; and

the provision of facilities for continuing training.

The Government have accepted this recommendation, and additional finance to the extent I have mentioned, that is, £258,000, will be provided. This additional finance is being provided by way of grant from An Foras Tionscal to the extent of £120,346 and by way of State loan to the extent of £137,654. This will bring the State's total contribution to this industry to £1,618,105, comprising grants of £525,346, loan of £137,654 and investment of £955,105. The additional money being provided will be used for the acquisition of plant, the provision of training facilities and support of the extra costs that are involved in the work through having to train workers.

In the present year and pending the receipt of the consultant's report, it was necessary for Potez Aerospace to get loan accommodation to keep the factory in operation, and a guarantee on behalf of the Government that State funds would be made temporarily available to cover advances to the extent of £90,000 was given. This sum of £90,000 will be discharged from the £258,000 which the Industrial Development Authority has recommended should be provided for the company, and is not additional to the latter amount.

The consultants have pointed out that, at the beginning of 1969, the company should be in a much stronger position to undertake still more contract work. By that time they will have

(a) a trained work force,

(b) a name and reputation for reliable quality work and,

(c) a profit earning position.

Mr. Donegan: Perhaps the most appropriate way to make a contribution on this Estimate is to comment, first of all, on the Potez situation. Anybody who has interested himself in industrial development knows that [1576] most of that which was said by the Minister in introducing this Estimate is old wine in old bottles from the stock of the Minister for Finance, the Minister for Industry and Commerce and their predecessors. We knew how much the investment was in Potez Aerospace and in Aviation Development. We knew the money was gone and we are now told:

There must be strong reservations as to the value of the investment held by Taiscí Stáit in Aviation Development.

In this House we were subjected to catcalls by members of the Government and were told we were anti-industry because we drew attention to this fact, realising it was our serious responsibility to draw attention to the £1 million of Government money which had gone down the drain.

I wish the new development every success but I draw the attention of the House to the fact that the decision to invest a further £258,000 in Potez was a Government decision, made by the Government with the information at their disposal which is not available to ordinary Deputies, certainly not to those in Opposition. Therefore, to criticise that decision would be improper and incorrect and there is no criticism of it on this side. As far as we are concerned, we wish the new project every success.

However, that does not mean we must not draw attention to what has happened in relation to the Taiscí Stáit loan and tell the people that such a loan is given not on the decision of An Foras Tionscal but on the decision of the Cabinet. The loan of £509,000 was given on a Cabinet decision. We told them here quite a long time ago that the money was lost and the Minister now says there must be strong reservations as to the value of the investment held by Taiscí Stáit in Aviation Development.

Therefore, that means we started off with a loss of £1 million. At a time when France and England had to join together to make one aircraft and when in America huge corporations could not do it on their own and had to combine resources, it was questionable that we should think it possible that [1577] the P840 could be made here. I know the Minister was telling the truth when he said he had the best possible advice. Of course it is easy to be wise with hindsight. They had the advice and they went on it, but it means that never again can a Minister stand up in the House and tell this side, when we advert to the spectacular losses that have occurred in certain industries, that we are stabbers-in-the-back, that we are difficult and unreasonable, that there must be some failures, because every help has been given by this side of the House.

If on this Estimate I were to count the number of failures on the fingers of one hand and then move to the other hand to continue the count, I would perhaps do harm to Irish industry and therefore I will not do it. However, we must accept that in the future we must have better decisions in the giving of grants and loans. We must remember that this spectacular failure is not the responsibility of An Foras Tionscal, of the Industrial Development Authority or any other such body. The final decision on the Taiscí Stáit loan is with the Cabinet and it is a Fianna Fáil Cabinet and a Fianna Fáil Government.

Having said that, we find ourselves with a total investment of £1,650,000 and the hope that we will have a work force of a few hundred people by 1969. The wording on page 9, for somebody who had a story of sorrow to tell, is quite interesting. We had a long discourse in the Irish language — and more luck to him — for a start. A study of the English language in the last paragraph can be interesting:

...the company should be —

I stress the word “should”

— in a much stronger position to undertake still more contract work. By that time they will have—

—“should” and “will”

—(a) a trained work force, (b) a name and reputation for reliable quality work and (c) a profit-earning position.

I wish them all that, and I want to say that as far as this side of the House is concerned, anybody working out there, [1578] from this new managing director down to the man taken on last week, will get from this side of the House every help and encouragement and even an undertaking not to say things that we might like to say and not to advert to facts that we might like to advert to if it is going to create any difficulty.

Let the Government realise that, at last, what has been under a shadow of, certainly, deception and, certainly, reticence over the last number of years has now been removed from this shadow and the Fianna Fáil Cabinet have come here to tell us that their decision lost £905,000 plus £405,000 grant plus various sums totalling in the order of £1,360,000 and that now we are proceeding, with this huge potential behind us, having burned our boats — highly expensive boats they were — and we hope that we will have this work force of 200. We wish them well. Let us start from now, forget about all this, when the Government have taken their criticism because of it, and proper, due and right criticism. Let that work force go ahead to employ, if possible, within ten, 15 or 20 years, the 1,700 workers we were promised by a Fianna Fáil Cabinet that made the decision to give the loan.

Having said that, and it is painful but necessary for me to say it, I want to move on to the Estimate in general. The Minister suggested that last year he had been optimistic in his closing paragraph when introducing his Estimate and that there had been grounds for that optimism. Let us face the fact that the number leaving agriculture every year leaves us in a minus position as to employment and not only have we to absorb the numbers coming forward each year as the number of young people seems to increase — thanks be to God, they seem to be coming forward —but also to fill the gap created by the numbers leaving agriculture. It has been estimated that if we want to do this, we have to increase industrial production by 8.5 per cent every year until 1981. That estimate has been produced by the Government for programmes of economic expansion. We are now awaiting the Third Programme which we are told will not be as detailed as the First and Second. There are obvious reasons [1579] why that should be the case, when you do not reach your targets. But, from the Government's mouth and from the Committee of Industrial Organisation, we have this figure. We have not achieved that figure in any year. The sort of figure we have been getting is 3.1 per cent. Last year there was a fall of 1,000 in employment. The figures for employment in other years are available and clearly indicate that we are falling behind. For a Minister to come in here and say that there are grounds for his optimism is something I should like to hear him justify when he is replying.

In relation to industrial exports, certainly, from 1964 to 1967, we have moved from £78 million to £117 million but we have to take into account the consumer price index during the same period. That moved along too. The consumer price index, for instance, in 1965 was 181. By 1967, it had moved to 192. So that, when you take these figures in conjunction with our increase in industrial exports, you must take into account not only value, but volume, to find what the real truth is.

I feel that the Government have gone crazy and, perhaps, the rather painful reference I had to make at the start of this contribution goes to prove it, that the Government have been concentrating far too much on encouraging industries from abroad. The thing about an industry from abroad is that it has the technology and the huge corporation which can produce jobs, and politicians can say that that is nice, but, at the same time, the home-based industry is something that is fixed, that is made up of people who have their anchors down and who will not go away. Imagine the experience of people in Ennis only a few days ago who, on a brisk phone call from New York, found to the number of 182 that they had not any jobs left. This is something that just does not happen with Irish-based industry because the principals are themselves based here and want to stay here and will move heaven and earth not to have to move out of here. For this reason, I believe the Government have, as a creator of policy, gone wrong [1580] inasmuch as they have over-attracted foreign industry to the detriment of existing industry here and I propose to prove it.

I propose to prove it by indicating that up to a few short weeks ago there were only adaptation grants for existing industry and the adaptation grants consisted of grants to adapt yourself to compete in free trade and in the first stage of the adaptation grant there was no mention of competition for the home market with the Anglo-Irish Free Trade situation; it was free trade when we went into the Common Market. You got a grant for this and if you were in industry that had not got export potential or had not any exports at all but was merely a home industry, or if you were an existing industry that it was felt would not be hit by free trade, you did not get any grant. For two years here I said to the Minister that that had global exclusions; for instance, bakeries, because bakeries did not relate to free trade; bread would have to be baked here in any case.

Only recently on the Industrial Grants Bill, I indicated to the Minister that he had taken my view and had removed bakeries from this situation. Then he removed the adaptation grants completely from this situation and produced re-equipment grants. Now, no matter what you are, if you are a manufacturing industry or ancillary to manufacture, you can get a re-equipment grant and that includes people who are not exporting, people who will not be hit by free trade. We on this side of the House have been saying that for the past four years and the Minister has been sitting down and doing nothing and we had a welter of international consultants and Little Reports and all these things and, at the same time, most people involved, for instance, on the trade union side and the business side, knew the things that should be done and the things that were not being done. We knew it because we had studied what had happened in Northern Ireland and in the North of England where, if you got your invoice for your new piece of machinery and sent it to the Ministry, you got your grant; it was as simple as [1581] that; whereas we were being restrictive at that time and, at the same time, we were pouring money into foreign industries who are merely branches who, if they feel like lopping off an arm, lop it off and go home and leave us in a position where we have to re-employ people who were employed at colossal cost, the fantastic cost of grant, remission of income tax for exports, and all these things.

We on this side of the House want to make it quite clear that the basis of our industrial policy is private enterprise supplemented by Government help when private enterprise has failed and that a first plank in our army — the first defence and the first attack — is existing industry here. My assurance to existing industry here, no matter what Irish-based industry it is, is that if the Government change at the next general election — and this is something that could be discussed in this connection — then the first priority will be to get existing industry re-equipped, expanded and, if possible, exporting. The second move shall be to try to get industry from abroad to come in and set up here. But the first and most important one is existing industry. Existing industry at this stage outside the undeveloped areas will get up to 25 per cent of the cost of new equipment and new industry will get 50 per cent. I want to enunciate what has been enunciated twice in Fine Gael policy and referred to many times since — sometimes it gets publicity and sometimes it does not—that it is Fine Gael policy to extend to existing firms grants for adaptation up to 50 per cent, up to 25 per cent to be paid in cash now and the remainder when the work is done by way of ten yearly instalments of remission of income tax. That means we are prepared to say we will give existing industry the same grants as foreign industry. We will give them the opportunity to expand, extend and do their job. The Government are not doing that. They are giving them precisely half.

I am reading from a policy statement of two years ago which the Minister acted on three weeks ago. It states that our aim is to extend equipment grants to existing industry, whether [1582] their products are for export or not, and to end the system whereby certain industries are subject to a blanket refusal of grants. Here is one that has not yet been done by the Government but, as sure as God made little apples, they will do it in the next 12 months. It is to extend to successful applicants for adaptation or new factory grants outside the undeveloped areas remission of rates as at ten-tenths remission in the first year, reducing by one-tenth for the next nine years. This rates remission shall be effected by a 50 per cent contribution from the Exchequer and 50 per cent by local authorities. Now we have the Minister coming in and quietly saying that the re-equipment grants are now to be a little bit better and so forth.

The Fine Gael line is that first you must support existing industry. You must give it the same as industry from abroad. There has been a lopsided, top-heavy situation here. The Minister gets up and almost as a joyous statement tells us that the money spent on new industry to provide employment in firms with outside participation has been 80 per cent or £14.7 million. The most healthy situation would be if some firm like Hammond Lane Foundries became four times as big, because the managing director — I never met him— is based here. I want to become stronger about this and say this it where the policy has been stone mad, has been a political policy handed out from the Fianna Fáil Cabinet. The line has been that what you have got to do here is start a new factory, put up the national flag, turn a key in the door, drink a ball of whiskey and go home. Then you have created jobs for 150, 200 or, as in the case of Potez, 1,700 people and that means 1,700 families to vote for Fianna Fáil. We must have existing industries developed and helped to an extent not one penny less than the help afforded to others.

The Government here have lost out to Northern Ireland in regard to industrial development many times in the past five years and particularly in recent times. I live beside Northern Ireland. I know where the industries go. I know industries that came here and went away. One of the major incentives [1583] for industry is advance factories. We had them in Shannon. Many people were critical of Shannon, but it has succeeded now and the Minister says it is going to spread out to Nenagh. These advance factories consist of bays which can be rented and subsidised year by year. They are suitable for most normal industries. They might have the wrong shape for one industry in a hundred. Most new industries are created on the horizontal and these factory bays were excellent for them. After prodding and cajoling from this side of the House and elsewhere, we are at last to have two industrial estates, one in Galway and one in Waterford. The Minister should go up to what is going to be the new city of Craigavon and see what has been done in the way of providing advance factories there. He should see what is being done in the North of England, where gross unemployment has been caused as a result of shipbuilding going down. He should see how far we lag behind.

We have a firm of industrial consultants going to give us information almost immediately. The faceless men in the back rooms with their recommendations—recommendations which helped the Cabinet make a cod of themselves on Potez — have brought about the situation that the gateway to the West, Sligo, with all the boys and girls there who want employment, did not get an industrial estate. Right behind it you have a colossal work force. Everybody who goes to the West goes to Sligo. There is a tradition of industry there. It has everything, except jobs for its people. I gave a lift the other day to four people from Sligo working in Butlin's for the summer. They said that if they got a job in London for the winter, they would go there. That is an example of the futility of the industrial policy of the Minister and his predecessor, the policy of sitting and waiting for the reports of industrial consultants.

We want to get you out, get over there and get moving. The studies having been done, we are now trying to get the Third Amendment and the Fourth Amendment through the Oireachtas. [1584] When the referendum is beaten and PR is the system of election, on the studies done there will be 65 Fianna Fáil Deputies, 55 Fine Gael Deputies and 25 Labour Deputies. In that situation we on this side of the House will seek to get this industrial policy on the move, to give the same grants to existing industries as to new ones, to have advance factories, to have growth centres and to stop waiting for your international consultants. We will ask this House to make Deputy Cosgrave Taoiseach and to move him from that seat over to the seat at present occupied by the Minister. In relation to industrial policy we must consider that the Minister has been sitting down on his job.

Existing industry here — I will not mention individual cases because the Minister knows those to which I am referring — has been seriously interfered with by the dilatory nature of the prices stabilisation section of the Department of Industry and Commerce. One large company, because there was an increase in the cost of its raw materials, lost £400,000 and produced a loss and another lost £150,000 in profits during the last financial year because of the dilatory nature of the prices stabilisation section of the Department. In business circles in this city, the view is held that the Minister is all right, but there is one thing about him, that if you come up with an unanswerable case, something that has to be put forward, something that could mean unemployment or a disincentive to expand, the Minister will take six months over it. The proof of that is that in three separate instances, one in the past three years and two in the past 18 months, the Minister has acted in such a dilatory fashion, sending the case to some committee or commission to report on it, that there has been serious loss. In two cases there was serious loss to public companies and in one case there was a loss of £500,000 to the Exchequer and, as a result, a Supplementary Estimate. That is not stabilisation; that is sitting on the fence like Nero fiddling while Rome burned. That is not what is expected from a young fire-eating Minister for Industry and Commerce.

[1585] I suggest there is a time for decisions, a time when one must have courage to decide. If certain people can sometimes work out the figures on the back of an envelope, people who are not even involved, it seems unreasonable that it should take the Minister six months and £500,000 of Government money to settle a deal. I hope I am not being hypercritical; one can become that way when one feels deeply.

I should like to refer to the Fine Gael policy on private enterprise in business and industry. Our policy is one of encouraging private enterprise to perhaps too great a degree but when it has failed and has not done its job we are prepared to go in, if in Government, as public entrepreneurs. We are prepared to go in and if necessary invest public money in industries and try to do the job. But, first, there must be private enterprise, the effort to get people to invest in their own country.

I want to talk about something that has been the great failure over the last decades of the Fianna Fáil Government regarding the development of industry. For a company here to go public and allow the Irish people to invest in it, unless it is a huge corporation or a huge company which is very rare here — perhaps less than ten concerns — is virtually impossible. It is impossible for such a company to expand: its profits will not produce the amount of capital formation necessary and no commercial institution, banking or otherwise, will lend the amount of money needed without themselves getting a stake in the business. This is something that could have been attended to. The framework for it exists in the Industrial Development Authority but no Minister for Industry and Commerce — and they have all been Fianna Fáil Ministers over a long period — ever created the situation in which a medium-sized company could put itself on the market, have itself underwritten and go on the Irish market and secure continued and permanent investment from the Irish people who, perhaps, at the same time are investing in companies abroad. Perhaps that would take a small slice off the national loans — I do not think it would. This is one way in which the [1586] Government have failed existing industry.

As regards public and private enterprise, there has been talk of the necessity for taking over the sources of production. The good sources of production can operate successfully for profit; specific instances have been given. It is Fine Gael policy never to take over sources of production but to encourage them to expand but if we want to pick something that could be taken over by the Government why not suggest that if private enterprise has failed the Government should go in and do the job if they think they can do better. There is nothing wrong in that. But there must be the underlying right of a man when he has paid rent, rates and taxes to provide the high level of social amenities, health, education and social welfare that is within the “Just Society”, to go forward and seek his profits and every encouragement must be given to him to do so because in so doing he will be providing work for his own people.

If one reads the accounts of any public or private company one finds that the wages and salaries far outstrip any dividends or profits that come out for those who invest. It does not matter whether it is six or seven per cent or more, taken against the salaries bill it is far lower. We find that necessity exists here for expansion of productive capacity so that we can develop more thorough private enterprise. Perhaps I have said this two or three times in the last few weeks and perhaps it should be said again: where the Government seem to have failed is that they have never created a climate for growth. They have produced artificial growth, hot house plants, like those that have cost £1.5 million, but never the climate for growth which would attract huge corporations here. In certain instances you have had this type of thing, like Cement Limited which built a pipe factory beside their original factory and which are now spending £7 million on a new cement factory. That is very good but the Government have never succeeded in attracting large industries that would employ our people and produce here for export. The businesses that have [1587] come have been relatively small and the failures among them have been spectacular. I quoted a figure last year and I did so, so as not to name individual industries. It was something between £10 million and £20 million which can be proved to have been invested by way of grant and loan by the Government in projects that have little hope of becoming viable and some of which have gone to the wall.

What is not stressed in the Minister's statement is the Anglo-Irish Free Trade Agreement. If one goes through the Tariff Reference Book, putting the asterisks in the appropriate places, one finds that at least 70 if not 75 per cent of our industry manufactures for our own people and will be meeting the full blast of British competition in 1971. That is why we must aid existing industry and that is why the 25 per cent re-equipment grant for existing industries and the 50 per cent equipment grant for new ones is stone mad. It is just as important to defend the man who has a job and is rearing five or six children on his earnings as it is to find new jobs for those leaving the schools.

If this blast of competition is to come, as we know it will, the only provision in the Free Trade Area Agreement is that if it causes serious unemployment we can apply for postponement for 18 months. It is “postponement” for 18 months: we cannot succeed in getting anything else. The Minister for Agriculture had the experience of going over to Britain and trying to get extra subsidy on the 25,000 tons of beef which Britain subsidises. He was told bluntly that the agreement said 25,000 tons of beef and that he had better go home again. The best thing he could do when he spoke at the airport was to say that there would be 200,000 fewer cattle for export in future, his object being the good one of trying to keep cattle prices up.

In view of all that has happened in the meantime with France and de Gaulle, perhaps it was not the wisest thing to go into this Agreement suddenly. We on this side of the House voted for it. At that time it was the [1588] only thing we could do, but as things have gone, perhaps, we might have waited longer. It is certain that by 1971 the best thing we can do for 75 per cent of our industry, if it is unable to compete, is to appeal and, by agreement between the two parties, try to get a postponement for 18 months from the full blast of British competition.

Lest anybody should think that Britain is a nice fat man as John Bull was always portrayed, and that the Labour Government in Britain have put Britain in a dreadful position, let us remember that the price structure there is much lower than on the Continent, with the exception of Italy, and that most goods are far cheaper in Britain than they are in France. That is one of the reasons why France did not want Britain in the EEC. The immediate result would have been the transference of some of Britain's difficulties to de Gaulle, because of the price structure, because of the price of a pound of lamb in the shops of Paris, because a frock for a little girl of ten to 12 years of age in a shop, not an exclusive shop but a place like Clery's, will be anything from £10 to £13. Therefore, no matter how self-sufficient France is, those are the difficulties she would face if opened up to an economy like that of Britain where such prices would not obtain at all. It must not be thought, therefore, that we will be meeting a Britain that has too high a price structure, a Britain not producing quality goods. We will be meeting an efficient Britain. In that situation surely it is reasonable to try to get for existing industry support equal to that given to outside industry when coming here.

I am all for price stabilisation but, without the slightest shadow of doubt, it is most important that, if there is to be a price increase, profits are preserved. The only thing that makes the wheels of industry turn is profit, and anybody who is stupid enough to regard profit as a dirty word is not doing employment any good. In fact, studies on this have proved that in many industries here the problem is that profits are not sufficient to reinvest enough to keep abreast of the changing [1589] situation. They never will be, of course, and the Minister is again at fault in not creating a better situation to enable small companies to go public so that the Irish people can invest in them.

I should like to know from the Minister what is his definition of an ancillary industry. As far as I can see anything that is ancillary to a productive industry would be eligible for the re-equipment grant. However, it would be a help if the classification could be given when the Minister is replying because people do not know, and they are asking. Most of them were excluded from the adaptation grant system, but goaded and prodded from here and other places, the Minister has introduced the re-equipment grant. The circular on this is sketchy in the extreme and it does not tell one very much. Perhaps the Minister would let me know what sort of ancillary industries are entitled to grants.

I agree that studies are necessary, and it would be wrong of me to say that the Minister is mistaken in employing people like Arthur D. Little for this purpose. However, the type of studies necessary are more on the type of industry to which this country is suited. For instance, we have a particular situation as far as the export of agricultural produce is concerned, and the economists have been saying, quite wrongly, that we may lose £30 million on milk next year, and asking why then do we increase our production of milk. The answer is that our sails are set on this course: we must export our cattle to enable us to buy the raw material which we can re-export in the form of industrial goods. We must have cattle and milk, and we must continue to export industrial goods. If we are to look on for a decade or threequarters of a decade at the activities in the Common Market—the possibility of our entry has receded a little for the moment—we must not forget that there will be a great deal of trade with Britain in one form or another, and within this free trade area it would appear to me as if agricultural goods, if they follow the EEC pattern, must reach their real price, whatever the real price is; in other words, we are not going to be selling butter for half the [1590] price it makes here. If that is so, we should be, at this stage, giving greater encouragement to industry to process the raw materials within the agricultural-industrial field. Even if this means certain extra taxation for half a decade or more in order to establish these industries, it would be worthwhile in order to develop markets for the export of processed agricultural goods. For instance, we have a very good cheese factory in Deputy Corish's constituency in Wexford which is producing high-quality cheese.

Mr. Corish: Thank you.

Mr. Donegan: This is something that perhaps could be expanded. It is employing people. These are the studies to be done. We do not need to be told where our growth centres should be. Every one of us who is a member of a county council has had the opportunity of hearing of the studies of both Lichfield and Colin Buchanan on the probable growth behaviour in the various constituencies or counties over the next 15 years, and this is a document that should be read. It indicates to me what has to be done and the infra-structure that has to be provided, whether or not money should be spent on a particular road or not. These are the studies we have. The studies we should be getting are the studies of the type of industries that would suit us here, not for the short term but for the long term. As far as I know, the studies the Minister has are studies as to where he should put growth centres and things like this. He would be far better off if he sat down with a few single-minded and sensible men and decided where he would put them and put them there.

Let us remember we are behind our five per cent increase in production. We have got to stick to it until 1981 if we want to get full employment here, and we have got to catch up on the backlog. We do not show any signs of catching up. We do show signs of increasing our industrial production and of increasing the number in industry, but we are not increasing them by enough, and any feeling of satisfaction or complacency that might [1591] be aroused is entirely misplaced. We must decide by one means or another to increase this, and the only way to do it is by a dynamic policy of encouragement of existing private enterprise and also by the intervention of the State where private enterprise has failed, the intervention being certainly not on the good side of industry and always in relation to those projects that have failed or have just not been attempted.

In his last paragraph, the Minister referred to the question of industrial relations, which is outside the Minister's field; we now have a Minister for Labour. Let us face the situation. For 18 months now the proposals on new trade union legislation by the Minister for Labour have been rejected by the Congress of Trade Unions, and during that time literally nothing has happened. In this picture of man-days through lightning strikes and so on, which can be exaggerated to a great degree, and very often is, surely there should be a greater effort on the part of the Government to achieve industrial peace, to achieve a situation whereby industrialists, particularly from abroad —in my line of country he is No. 2, while the home industrialist is No. 1— would be brought here with a feeling that there would not be this sort of industrial strife. May I say, irrespective of the rights or wrongs of this case, that anyone who will not deal with trade unions in the year 1968 is industrially stone mad and cannot get away with it? It is a point of principle. It is like lying down on the road in front of a vehicle travelling at 80 miles per hour. Perhaps this is not exactly the place or the time to say it, but that is my view and I have stated it a few times in this House and outside it over the past few months.

We have no detailed information on the shipbuilding subsidy. The Minister gave us the broad details about what will happen. I would be obliged if, when he is replying, he would go into further detail and tell the people what the plans are. When the Taoiseach and the Minister are conferring with the Minister for Finance they must decide [1592] on plans for ten or 15 years ahead so that the shipbuilding complex will be viable and give employment. No indication of that has been given. This is very different from the Potez statement which was made today and which was certainly a baring of the breast. We were told what had happened and every failure was indicated. I wish the shipbuilding complex in Cork nothing but well and I am prepared to support it fully. The rather sketchy reference to it in the Minister's statement should be expanded on when he is replying. We should be told about the hopes for the future in a decade or thereabouts.

Accession to GATT is something which should have happened before. It is part of the movement towards free trade in which we are like an empty matchbox floating down the stream. We have no choice as to whether we should or should not join. It is a question of when and how we should. If there were anything we could do to lessen the blow, or if there were anything clever we could have done, these are the only considerations to be taken into account. Anyone who wants us to be an economic island in the middle of the Atlantic will very soon find out that the whole structure of the country would fall down. Accession to GATT is something that has to come. As in the case of the EEC our application still stands. It has receded further. The Anglo-Irish Free Trade Agreement binds us to a very strict time pattern which was not sufficiently emphasised.

I hope I have given the Fine Gael policy on industry. Fine Gael policy is equal grants for home industry, remission of rates for ten years reducing by ten per cent each year, full remission in the first year for new industries, half to be paid by the Exchequer and half by the local authorities, extension of grants for adaptation or re-equipment up to 50 per cent, 25 per cent to be paid in cash in ten yearly instalments and the balance by way of remission of income tax. These are matters which I feel should be attended to. If we do not get our existing industry expanded we will be in queer street.

We need more Irish investment in Irish industry. There are too many family firms which do not become [1593] public when they should. Some have gone to the wall spectacularly in the not too distant past. There are firms producing the service of supplying industry in large areas in the country or in the towns, and they are in the backwaters. They are so big that they need enormous amounts of capital and they are so small that they cannot become public. I should like to add that to the other points of Fine Gael policy.

Mr. M. O'Leary: I have always regarded the function of this Department as one of the most important functions of the Government, having the responsibility for creating new employment and overseeing industrial expansion. We have quite an amount of employment in State enterprises and it is obvious that this Department will have more direct influence on our economy than a similar Department in another country in Europe. We have always held the old-fashioned view that the test of our progress as a country is the number of new jobs created each year. This is why we consider that the Government have been a failure. We suggested before that we think one of the reasons may be that Irish industry is not expanding sufficiently strongly. In the latest figures we are told that of the 220 new industrial projects approved for grants up to the end of March, 1967, 48 only were sponsored solely by Irish capital. We have also the alarming situation that imports are becoming more and more competitive with the products of Irish industry and that the home market is being whittled away by foreign interests. This is a fruit of the free trade stream in which we are caught. Surely there must be something the Government can do in this terrifying situation.

I have said before that part of the problem of the inefficacy and impotence of the Department to make any meaningful impact by way of new jobs or some innovations in Irish industry, is caused by the limitation of the Department's role which the Minister accepts as do the spokesmen of Fine Gael in the belief that private industry is our best bet. That would be fair enough if we could point to the success of private industry and if [1594] we could point over the years to steadily rising employment and achievements by way of new jobs. Private industry has not shown the will to expand and has shown little interest in the export market. In the latest booklet from the FII one gets the disturbing impression that for many Irish firms exports are purely a marginal activity which they carry on at this particular time and that the home market still remains the be-all and the end-all of their operations. I say that is the limitation of the Department, the belief, wholeheartedly subscribed to in this theoretical doctrinaire policy of laissez faire, that private enterprise is the best method of attracting industry to this country. Having nailed our colours to this masthead, we have gone all over the world to get foreign industrialists to expand industry here. We have competed with England to get foreign industrialists to come here. We have not done as well as the other part of our country, the North of Ireland, who have left us flat in regard to the size of industry they have managed to attract, and, let us say, the stability of the expansion possibilities of such industries. Look at some of the units which the North of Ireland Government have managed to get in the past few years and it shows by contrast the kind of small industry we have managed to get in. The typical average industrial unit we have managed to attract has been in the 50 to 100 employees class, whereas in the North of Ireland it is in the range of hundreds, as in the case of Michelin Tyres. I do not know the reason for this but the actual cash subsidies at the service of the Northern Government are certainly one element in attracting industry as well as greater skills in the population and so on. I am merely mentioning this to show that we are attempting to hit a moving target when we are placing so much of our hopes for the future, for the permanent attraction of foreign industry, on providing incentives such as the building of factories and so on.

One interesting thing about the amount of foreign investment here is that it is mainly in the metals and the [1595] minerals and food spheres that we have notched up the greatest advance in exports. The metals and the food industries together contributed about 40 per cent of the advance in 1966. It is interesting to see that metals and food must surely be areas in which we ourselves should have employed our own resources in this period. The minerals which have inflated our export figures in recent years, the exports of commodities from beneath Irish soil, should surely have been a source in which Irish capital should have been employed. In the food group also we should have used our resources, our expertise and our capital. Would it not seem that much of the foreign enterprise coming in here is in fact going into areas in which, rightfully, if we managed our own affairs properly, we should have the major say by moving under our own steam in these areas? The Minister referred to events abroad and of course it is not certain that events abroad may not to some extent damage the possibilities of further foreign investment. The Minister mentioned American measures in regard to investment abroad and recent events in Europe and it might be that we would have a similar follow-up in regard to investment here. There is nothing certain about depending so much on and placing so much of our hopes on expansion by help from abroad.

The physical adaptation to which the Minister referred has gone on, but the CIO, which he mentioned, expected that this amount would be spent on the physical adaptation of industry and both the CIO and the NIEC anticipated that by 1968 we would at least be making inroads on the figures for increasing employment each year. We have not been getting near those figures and let us repeat that each year in order to keep our heads above water and in order to keep some of our people at home, we would want to provide on average 16,000 new jobs. That is the first task we should set ourselves before we can say to all the people under our care in the Twenty Six Counties: “You have a chance to live and work at home.” The figures show [1596] that we are nowhere near that target. It is no pleasure for anyone to come in here and point out the fall-off in achievement in this area. We are not achieving any of the targets which the NIEC said we should achieve in this period to come near to getting something like an emigration rate of 10,000 by the end of this decade.

Is it not time that we looked at and questioned the policies which year after year we cherish? We say that we have nailed our colours to the masthead of private enterprise, and most politicians here say that, but has this in practice brought about any increase in industry or shown itself to be for the good of the country? Or should we look at what some people would regard as the more unorthodox socialist methods, or whatever you like to call them, not the conventional measures but measures which other countries on the Continent have tried, European countries with mixed economies which have adopted a far more imaginative idea and used the State as a corporation for development? We believed that private industry, foreign or otherwise, patched up with incentives would provide the vast number of new jobs that we needed but frankly our Party doubt this. I know that there are influential people, the press and other commentators generally, who are ready to castigate any new measure which in any way differs from what the majority think. The true political responsibility for those of us who are interested in getting new jobs is to banish the shibboleths about private enterprise and to ask ourselves if in the Twenty Six Counties it has done the things we want or should we think again and see how we can use the State to advance us in the matter of providing new jobs.

The real difference between ourselves and the Minister when he says that it is primarily the job of Irish industry to prepare for free trade is in our attitude to the function of the Government at this time. It is the Government's job to be in the front line in creating new jobs or else in 20 years time there will be nothing left to talk about. If the Government stand aside and leave industry to fend for itself, having given it the suitable carrots and [1597] if industry does not take the carrots, then the employees will be the ones to suffer in the long run. It is dangerous that a Government should restrict itself in this fashion. What is wrong with this idea of an imaginative use of the State? Many people when they hear the word “State” throw up their hands in horror and think that here are more bureaucratic language and clichés to get away from the problem. What is wrong with the State stepping into an area, say, in heavy industry, in which it has already invested heavily?

We do not wish anybody to misunderstand us in this. We would like to see a marriage between efficient private enterprise industry and State enterprise industry. We do not wish that one should completely wipe out the other. Most certainly we hold it is too expensive a proposition for this country to relegate all its hope of the future and depend exclusively for industrial expansion and the creation of new jobs on the kind of managerial element we have at the moment. We do not think we should stand apart and say that this is someone else's preserve and the State can go no further because of certain philosophical concepts more properly belonging to the 19th century. We say it is the first duty of the State to provide jobs for Irish men and women and, if in the course of providing those jobs, we have to knock ideological concepts appertaining to the last century, then let us do so. All the policies pursued under inter-Party and Fianna Fáil Governments designed to create employment have not succeeded in creating employment.

This is not propaganda. This is proved by statistics. Each year we get varying figures, depending on the building industry in Britain and the numbers of our people who emigrate into that industry. If we are to break through we shall have to develop a new attitude to State initiative. Even in existing circumstances it is ridiculous that there should be such cleavage between the Department of Finance and the Department of Industry and Commerce. What is required is an amalgam of these two Departments. The idea of the Department of Finance [1598] —this is an idea taken over from the British—being a watchdog over the spending of the Department of Industry and Commerce is an outmoded idea in our time. There should be an amalgam of the Department of Finance and the Department of Industry and Commerce for the purpose of creating new industry by the imaginative use of State aid.

The Minister mentioned distribution. He said it was not simply a matter of new jobs in industry. I could not agree with him more. We see the things that are happening, allegedly in the name of progress, which are accepted as inevitable. “Inevitable” is one of the new words in the Irish political vocabulary. Anything that happens, be it beneficial or adverse, is described as inevitable and it is regarded as foolish to argue against what the majority accept apparently as inevitable.

Every new supermarket is regarded as another milestone in progress. Every new supermarket is regarded as showing a greater degree of efficiency in the Irish distribution industry. Nobody questions the ownership of the supermarket and nobody worries about increasing competition. If a monopoly is gained by foreign interests on the home market how can we retain any part of that home market for our own products? I have already brought to the attention of the Minister the fact that Kraft cheese is as common in our supermarkets as any of our Irish cheeses. One wonders why this should be so. Jacob's biscuits will be as rare in our Irish supermarkets, if the present trends continue, as British biscuits were in the past.

All one need do is walk through any supermarket to see the shape of things to come. More and more British goods are coming in. We have had a Buy Irish campaign to get the feeling amongst our people that they should buy Irish manufactured goods, but our market has never been so securely under our own control that we can depend on the automatic acceptance by our people of supporting Irish manufacture. The British consumer will buy British. One wonders whether we have had long enough control of our Irish market to speak in terms of the loyalty of the Irish consumer to [1599] Irish goods. This so-called loyalty will be tested in the years ahead. Judging by what one sees in the supermarkets Irish firms generally are not really competing as fiercely as they should on the home market, as fiercely as they may be compelled to compete in the future. They do not appear to be all that concerned about the home market, though that is the market on which they will have to depend when the tariff wall falls. The position will be made the more difficult because so many foreign interests are gaining control over our distribution trade. I do not regard this control as inevitable and I certainly do not regard it as progress. Why is it Irish firms will not combine to run native-owned and controlled supermarkets in order to ensure a market for Irish products in the years ahead?

Mr. Donegan: We have one Irish one.

Mr. M. O'Leary: I know, and the Deputy will be telling me about his constituency in a moment.

Mr. Donegan: No.

Mr. M. O'Leary: This is an important matter and the Minister does well to stress it. He and we will do much more, however, by ensuring that Irish industry invests in its own future for its own future. It does not appear to be doing that at present. We would much prefer to find ourselves able to talk here about efficient Irish industry in the State sector or in the private enterprise sector instead of pointing to the failures and drawbacks and to the lack of initiative. It is tragic to see foreign enterprise going into areas in which Irish capital should have been employed and in which Irish know-how should have been involved. Irrespective of whether or not one is a socialist, it must be admitted that where assets are owned by foreigners that ownership connotes in the long run a loss to the economic future of the country. We fully understand that. Indeed, if Irish private enterprise really understood who its friends are, it would appreciate that there are more of them in the Labour Party than on the opposite side of the House.

[1600] A great deal of Irish capital has been invested in Britain. Whether that is because of past history or because of higher rewards I do not know, but it is admitted that money which should be invested in the rural areas is invested in Britain. Those who have money to invest do not seem to appreciate that they have a responsibility to the community which enabled them to make that money in the first instance.

Industry and Commerce is the most important Ministry in the Government. The test of success of any Government is increasing productivity and increasing exports. But the acid test showing how far we are progressing is the number of new jobs created every year. In this sphere, unfortunately, we are not succeeding. We must, therefore, I suggest, try new policies. We must not be held back by any kind of doctrinal beliefs, by fears that we may be going too left in our remedies. It has been true that some of the most successful enterprises in our country have been motivated by State intervention. The State companies may not be models of industrial democracy or of good relations between management and employees but for this the fault lies elsewhere. At least they have given evidence of being industries that manage to keep their heads above water, that expand year by year and give stable employment to our people. I think the Minister should really call these State bodies together and tell them from now on he is expecting from these industries that they will move right into manufacturing areas. To expand employment should be their primary duty, to see that they are not held back by any kind of feeling that they should not expand to certain areas, that they are not held up by outmoded prejudices, that they now proceed into areas where in fact there is scope for expansion so that we shall have more employment.

We suggested before that where a private enterprise is in need of large expansion we would wish to see State enterprise intervene. We are not doctrinaire about how the State should intervene. We consider that a partnership between the State and certain private enterprises would be a good [1601] thing, but we have always said that where a firm which has a lot of taxpayers' money involved in it and where so much employment depends on the proper deployment of that cash, where the State is becoming a sort of milch cow for a particular private firm, there must be some Government representation on its board of directors with a say in the decisions of the board. The idea that the only Government function should be to reach into their pocket and hand out money to a managerial board is all wrong. It does not seem to us to be good sense. We would say that there must be a far stronger manifestation of the interest of Government in the success of that firm. I do not wish to rake old coals but I would suggest that this Potez Aerospace is a case in point. Without saying anything further about it, there is a State investment of £1½ million in that firm. That is a great deal of money. I would say that there would want to be United Nations presence to see that this is properly deployed, not to mention Government presence.

Mr. Donegan: £1½ million.

Mr. Corish: It will be soon.

Mr. Donegan: It is already.

Mr. M. O'Leary: It is not my function to speak on this at the moment. There is a lot of money gone into it at any rate and let us hope that things work out. Where there is taxpayers' money involved, it is not good enough for the Government to come to this House and give various excuses and point to statistics which say that we have a lower failure rate than other countries. We cannot afford any failures in this country.

We suggested before that in the case of many of the new firms coming into this country, one often has the impression that not sufficient investigation is carried out into the kind of markets for which these products are destined and that there is not, in some cases, enough technical know-how. We need to see that the bargain we are getting will stand the test of time. Even though we may be labouring the point, it is well [1602] worth labouring. I can imagine the eagerness to get a particular foreign firm in, the eagerness to overlook difficulties, but in a few years time the difficulties come up in the shape of quick notice, a firm withdrawing. We have seen a recent example of this. People say that industrial relations are to blame, that union officials are to blame, that there are agitators of all sorts engaged in movements, but then we read in a paper last Sunday of people employed by a foreign firm getting notice on Friday that they would not have work on Monday. When one sees this kind of thing, one then understands why there is a residue of suspicion about managerial motives in this country. One understands fully why there is no need for an agitator or for trade union officials to beat proletarian drums or class-war drums in this country.

I would suggest that we should tell firms coming into this country about the practices we have in industrial relations, what trade unions are and that whether they like it or not, they must put up with them. We should explain to them that trade unionists' money is involved in the tax concessions they are going to get. So many trade unionists in this country pay for the money which they receive from the State and the very minimum of good manners and courtesy to the people who give them the money should be to respect the institutions we have set up in this country. It should be explained to them that trade unions in this country are not revolutionary organisations which are going to remove managerial boards the following morning, that they are a sane body of people who wish to work in partnership with management up and down this country and the record is there to prove that they in fact negotiate responsibly. The very least we can expect from the foreign enterprises is an acceptance of the trade practices in this country.

Repeatedly over the years we have called for more markets for our products in new areas. As I suggested earlier, there should be this development group between the Department of Finance and the Department of Industry [1603] and Commerce to initiate new industries, to cut through the red tape and to get rid of this idea that the Department of Finance is a kind of treasury watchdog. This idea is more in keeping with Whitehall days than the ideas of today. We should explore once again what the Irish Exporters Association have been doing. They have been doing very valuable work in discovering markets. There is a possibility of expanding markets in Eastern Europe. We most certainly commend the approach of the Irish Exporters Association because there are many people in this country who consider that trade with communist regimes somehow blackens our own integrity in the eyes of the world, little realising that there are other countries in Europe with equally as strong anti-Communist beliefs as we have, who have full diplomatic relations with these countries because trade is something quite apart from the moral feelings one might have towards a particular state. It is criminal to neglect even one area in these countries which could yield employment. It is criminal to ignore the search for these markets because of shibboleths or doctrinal opinions that we may have taken out of the past.

The accusation that Labour are doctrinaire could more properly be applied to the people opposite because we heard from the chief Fine Gael spokesman today that their policy is absolutely committed to private enterprise. We heard from the Minister that they are completely committed to private enterprise. What we say simply is that it is they who are doctrinaire in this House. If this private enterprise system they are defending, our whole system for the future, has not provided the jobs for the past 40 years under all kinds of Government, what kind of confidence can we have in the future? We say the State itself must take a ground line position in this matter of national survival, of new jobs that we must get each year. The real laurels for achievement for any Irish Government must be the achievement of new jobs.

The policies the next Government pursue must be the radical ones we [1604] have been suggesting over the past two years and which we hope to reveal in fuller depth next month. The manner in which the State developed industry, where private enterprise is efficient and egged on to greater efficiency, certainly does not reflect very well on the philosophical policies pursued over the last few years. Let any man or woman tell us that there is something wrong with developing that policy of ours and we say that our first and real obligation must be to increase the number of new jobs, which is something we have not been doing. The size of the task before us is to create 16,000 new jobs each year. All of us must face that. The question all of us must face is whether past policies will succeed in providing those new jobs. None of the figures which the Minister has brought forward and none of the proposals of the industrialists will make any impression in depth on this task unless it is tackled in the way we have suggested.

Mr. T. O'Donnell: I intend to be very brief on this Estimate because it is only a fortnight since we had an opportunity of discussing at length the question of industrial grants on a Bill which the Minister brought in. First of all, I want to welcome what I would call the first official announcement made in Dáil Éireann of the decision of the Government to extend the scope and activities of the Shannon Free Airport Development Authority to include Limerick, Clare and North Tipperary. I am also pleased to note that it has been decided to bring the industrial section of the Shannon Free Airport Development Company under the control of the Department of Industry and Commerce.

This extension of the activities of the Shannon Free Airport Development Company to include Limerick, Clare and North Tipperary is a step we have been advocating for quite a considerable time. Many public representatives in the region have advocated this step. It is a logical one and I have the greatest confidence that this new development will lead to the expansion of industry not merely at Shannon itself but in the entire region, which has now been designed as a growth [1605] area. We have in Limerick been complaining time and time again about the time again been complaining about the lack of industrial development in our city and county. There is no doubt whatsoever that the industrial estate established at Shannon 14 miles from Limerick city proved to be detrimental to Limerick city obtaining industries and it has become obvious for quite a long time past that the logical approach to industrialisation in the Limerick region was to have some link-up with the Shannon industrial complex.

This is a very desirable development because the management and the executives of the Shannon Free Airport Development Company have had a great deal of practical experience in industrial promotion and it has been recognised that their efforts have met with considerable success. I understand also from certain press statements, although the Minister did not refer to the matter in his speech, that the Shannon Development Company have taken the option on a site for an industrial estate at Raheen, a couple of miles outside Limerick city. There is a good deal of confusion at the moment in Limerick regarding this particular site. We do not know whether or not it has been acquired, whether an option has been taken or whether or not the Shannon Industrial Company may now proceed to erect factories on that site.

Some people think that before any development at the Raheen site can be undertaken new legislation must be passed in this House. The Minister referred to the fact that he hoped in the near future to introduce new legislation dealing with the whole question of incentives for industry. I would ask the Minister, when he is replying to this debate, to clarify the situation in relation to the new regional development authority which has now been established for the Limerick, Clare and North Tipperary region. As I said, we know and we understand quite clearly that the Shannon Development Authority have been given responsibility for promoting industry in that particular region which includes Limerick city, County Limerick, North Tipperary and [1606] County Clare but we would like to have some more definite information as to what the inducements are regarding the actual development of an industrial estate at Raheen, outside Limerick.

We would like to know what grants and what facilities will be made available in that area. We want to know whether the same grants and the same inducements, which are available in the Shannon Industrial Estate, will be available to Limerick. Those are important questions. They are important questions for any potential industrialist who might be contemplating going to the Limerick area. I have had in the past month the happy experience of being involved in piloting two proposals through the Industrial Development Authority for the establishment of new industries in Limerick city. The question which I now pose in relation to the grants and incentives which will be available in Limerick under the new set-up is whether they will be as good as those which are available now in the Shannon Industrial Estate.

Now that we have gone away from the actual single centre Industrial Estate idea to one of regional development, it is only right and fair, if we want to carry this thing through to its logical conclusion, that the same grants and incentives should be available in that region and that there should be no differential in favour of one particular part of the region. We have suffered because of this in Limerick for the past eight to ten years where an industrialist crossed the Shannon, went out 14 miles to the airport and there he was able to secure far better grants and far more attractive inducements than if he established his plant in Limerick city. I hope, when the Minister is replying to the debate, that he will be able to throw more light on what the inducements are regarding the actual promotion of industry in the new Limerick-Shannon region.

I am also pleased to note, as I said, that the industrial section of the Shannon Free Airport Development Company has been brought under the control of the Department of Industry and Commerce. Hitherto it has been under the control of the Department of [1607] Transport and Power. I am not casting any reflection on the Department of Transport and Power when I say that it is only natural and logical and is a good thing that this industrial promotion section of the Shannon Free Airport Development Company, which is now being charged with a much wider area of responsibility, should be directly under the control of the Minister who is responsible for the promotion of industry in this country, the Minister for Industry and Commerce.

In relation to the decision to create a development region in the Limerick/ Clare/Tipperary area, I believe this is a new concept. It is a concept which I sincerely hope will work out well in practice. It is a new concept by reason of the fact that up to now we had one industrial estate at Shannon, one in Waterford and one in Galway. These are localised in a particular area. With this new development in the Shannon area, we have a new idea in that we are getting away from actual localised industrial centres to regionally developed ones. As I said, it is a new concept and something which I think most people will agree will be successful, provided certain precautions are taken. I think it is vitally essential to the success of this concept of industrial development on a regional basis that local initiative and local effort should be taken into account and that the resources, no matter how slight they may be, of the local development association in the towns throughout the particular regions should be harnessed to this whole question of regional development.

We have had a situation that in recent years there has been a vast increase in the number of local development associations. I read recently that there are approximately 200 local development associations in this country. I have stated before in this House, and I want to repeat, that it is my opinion, from contacts I have had with some of these local development associations, that the amount of time, energy, enthusiasm and even money wasted by these associations in an endeavour to attract industries to [1608] their particular towns or villages, has been colossal.

It has been suggested here in previous debates on this Estimate that in the Department of Industry and Commerce an effort should be made to co-ordinate and guide the efforts of those local development associations. With the introduction of this new idea of regional development. I would envisage local development associations playing a very important role in the overall industrial development of a particular region. There will be psychological problems to be overcome in the sense that every local development association is noted for its fierce spirit of independence, what one might call a parochial outlook, in the sense that their whole effort is geared towards trying to secure an industry for a particular town or village.

There is reason in making use of local initiative, local enthusiasm and local resources and we should try to bring these local development associations within the framework of a regional development programme. There will be an opportunity now, with the creation of this new regional development authority in Limerick and the establishment of a special office there with an executive in charge. I do not like to call it an experiment; at this stage we have had enough experiment in promoting industry. The time for experiment is past, and I sincerely hope that all the factors in the region will be taken into account and that the local development associations in the various towns will be persuaded to co-operate and will be educated into a realisation of the fact that where their particular town may not be suited to a particular industry, a town three or four miles away might be ideally suited, and that if the town next to it is not suited to an industry, the local development association in that particular town should throw its weight behind its neighbouring development association in an effort to secure an industry for the particular region.

I know from contacts I have had with development associations that when they advertised, perhaps 40 or 50 replies were received from prospective industrialists and from these 40 or [1609] 50 replies, or inquiries, three or four were selected and the other 35 or so were thrown into the wastepaper basket and burned. It is quite possible that among these 35 other inquirers, there could be an industrialist who might have been interested in a particular town in that particular region. I see great possibility in this whole concept of regional development.

There is another factor to which the Minister referred and which is very much related to what I am trying to say about the new regional development authority for the Limerick area. The Minister did say that among the surveys being carried out into the whole question of industrial development, an examination is now being carried out by a firm of consultants into the possibilities of encouraging the promotion of industries which would utilise native resources. This, I think, is very important. When we look at the region which will now be administered by the Shannon Free Airport Development Company, we find that the traditional industrial structure of that region is based on food processing and it is a region which has been for over a century noted for the processing of milk and bacon products particularly.

What I am concerned about is that, on the one hand, we now have a new concept of industrial development; we have new plans being made and a new administrative structure being drawn up to promote industry in this region, while, on the other, in that very region some of the traditional industries which have flourished for over a century are in difficulty. Some of them have closed. We have apparently a situation in that region where we have bacon factories closing because of shortage of pigs while on the other hand we have not enough milk processing factories to utilise all the milk produced in that region. I have spoken on this Estimate here in past years and have referred to this question of promoting industries which would utilise our native raw materials and resources and the principal resource we have is the produce of our land. There is a whole lot of confusion and a considerable amount of difficulty [1610] in getting a good food-processing industry established.

I hope, now that steps have been taken to simplify the whole approach to industrial development—a simplification of things in that we now have Shannon Airport Development Company industrial section brought under the control of the Department of Industry and Commerce, and a merger coming between the IDA and Foras Tionscal, that the Department of Industry and Commerce and the Minister for Industry and Commerce will take responsibility for all aspects of industrial development. The Minister has responsibilities in the matter of the establishment of the food processing industry but the Department of Agriculture seem to have full responsibility for that. I have said on numerous occasions — and I consider it virtually essential when approaching the question of industrial development, particularly now — that we seem to be proceeding on the basis of industrial development on a regional organisational basis.

We must not lose sight of the fact that there is a vast potential for the establishment of industries utilising natural native resources, but of the various regions. We have yet to see the survey the Minister has commissioned into the potential for establishing further industries utilising native resources of this country. It may well reveal a very interesting situation and it could well pinpoint what has been a very serious defect in our whole approach to industrial development here.

Enough attention has not been paid at all to the question of encouraging and promoting and establishing industries utilising the natural resources of this country and the great natural resource we have here is our land. Certainly I hope that when the Minister introduces the new legislation which has been promised and which will legalise the new set-up in the Limerick-Shannon region, he will not lose sight of the fact that the main natural resources of that region are milk and bacon, and that these products can be processed in a way which will help to solve the unemployment we have down [1611] there and at the same time increase our total exports.

The Minister also referred to the Small Industries Section of his Department which was set up two years ago. I am glad to note that this Section is justifying its existence and I sincerely hope it will be given every encouragement to proceed with what is a very important sector in our industrial structure. I remember in 1964, 20th June, 1964, I think, speaking on the Estimate of the Department of Industry and Commerce. At that time I referred to the fact that this was the only country in Western Europe which did not have a special body or a special agency or organisation to deal with the extension and establishment of small industries. Since that time much interest has been aroused in the question of small industries. This has been due to research work undertaken by, I am pleased to say, two distinguished Limerickmen. The first was the Reverend Professor Jeremiah Newman of Maynooth College, who really pioneered the research in this field. The extent of the work which he undertook in analysing the situation revealed that even in the most industrialised countries in Western Europe, and even in the United States, the small industries, even those small craft industries employing only two or more people in rural towns and villages, had, in this modern age of high-powered industrialisation and automation, a vital role to play.

Following Professor Newman's research and writings on this subject, the then County Manager of Limerick, Mr. T. M. O'Connor, undertook a survey of small industries in County Limerick. He was further encouraged in this work and he published a study in 1966 which clearly confirmed Professor Newman's idea and eventually led to the Department of Industry and Commerce setting up the Small Industries Section.

When the Minister is replying I hope he will clear up a few problems relating to this newly-created Small Industries Section. I should like to know whether this will become a permanent section of his Department and whether the people who have been seconded to this [1612] section will become established in this particular work or whether they will be merely seconded and that when their term is up somebody else will be shoved in. I am convinced, and I think more and more people in this country also are beginning to be convinced, that particularly in Ireland there is a tremendous potential and tremendous scope for encouraging the small craft industry.

There is scarcely a town or village in rural Ireland where there is not at least one family or one member of a family who has a skill which has been inherited and built up for several generations, such as skill in the making of a highly specialised product such as Limerick lace or in some other craft. If these people get the right assistance, if their little workshops can be equipped with modern machinery and if they can get proper guidance in production and marketing, all these small outfits, which, individually, may employ only one, two or three persons, when added together can represent a very respectable amount of employment.

Recently, I was pleased to read in the national papers of an extension of this idea of craft industries or small industries by the Slievebawn Co-operative Society which, I think, is in Roscommon. This is a co-operative organisation which has been set up for the express purpose of marketing the products of craft workers in the area. One skill that is traditional in the area is rush work. I presume that is the making of baskets and other articles from rushes. The organisation has been established through the initiative of the Irish Countrywomen's Association.

There are craftworkers in my constituency. There is one man who has developed a very high skill in the production of small ornaments from wood. About two years ago somebody who was sufficiently interested in his work did a market survey as a result of which it was discovered that the articles produced were very saleable.

I envisage that the Small Industries Section would undertake investigation in this connection, that it would find out where these craftsmen are and examine the possibilities of their products, [1613] and would assist the workers in obtaining modern plant and in modernising their workshops, and that advice and assistance would be given in finding markets. This is, broadly, the function of the Small Industries Section which was set up by the present Minister for Industry and Commerce. I do not know if this is the first occasion or not, but, if it is not, I make no apology for saying again that I compliment the Minister on having realised the potential of the small craft industries and for having done something practical about it in creating a special section of his Department to deal with small industries.

What we mean by a small industry is not generally realised. In this country if an industry employing 100 persons is established in a town it is regarded as a large industry. As far as I am aware, the Small Industries Section has been set up for the express purpose of looking after industries employing from one to 20 persons. While it may seem ridiculous in this modern age of large-scale industrial development and high-powered technology and automation to speak in terms of one-man or two-man or three-man craft industries in a rural town or village, it is a fact that, taken in toto, small industries can represent gainful employment for 4,000 or 5,000 persons in this country.

Those of us who are interested in this question of small industries are anxious to know the Minister's intentions with regard to this new section of his Department. I hope that when the Minister is replying to the debate he will give us some information on this matter. I hope that it is his intention to make the Small Industries Section a permanent feature of his Department and that the personnel of the section some of whom have been seconded from other Government or semi-Government bodies, will be permanently established in the posts which they now hold and of which they are making a tremendous success. I want, in particular, to pay tribute to Mr. T.M. O'Connor who was our County Manager and who, I suppose, officially, is still the Limerick County Manager. He has carried out research and has [1614] made a study of small industries and has been appointed in charge of the Small Industries Section which I hope will become a permanent feature of the Department of Industry and Commerce.

The Minister referred to the fact that it was intended to amalgamate the IDA and An Foras Tionscal. This is a good idea. There have been far too many bodies, organisations or agencies involved in industrial development— the Department of Industry and Commerce, An Foras Tionscal, the IDA, the Industrial Credit Company, Taiscí Stáit and a whole lot of other semi-State bodies, the Department of Transport and Power and the Department of Agriculture. It would be much better to simplify the organisation. I have the greatest regard and highest respect for the people in both the IDA and An Foras Tionscal and have had a good deal of experience of them, having had several dealings with them. I have nothing but praise for the work they are doing and for the ready manner in which they co-operate with anybody when it is a question of trying to establish an industry in any part of the country. I certainly have received nothing but co-operation and help from the officials of the IDA and An Foras Tionscal. But, because of the fact that there are so many State agencies, each autonomous, from the time an industrialist makes an inquiry until the actual proposal is finally approved and the grant decided on, months can elapse and some industrialists, particularly foreign industrialists, tend to become impatient and, not having the patience that we have, could tend to get fed-up and not bother. The fact that An Foras Tionscal and the IDA are being amalgamated will have the effect of expediting the processing of proposals for industries.

Criticism has often been levelled at the IDA. I want to put the record straight here, for fear I may have created the impression that I was insinuating that the IDA and An Foras Tionscal were unduly cautious, and that they used a fine comb to ensure that a proposal was genuine. The lesson of the Potez company made it [1615] absolutely essential for the IDA to be cautious in vetting proposals for new industries. On a number of occasions I have been involved in trying to get proposals through the IDA. At present, as I said, I am in negotiation with them for the establishment of two large industries in Limerick city. While I might feel impatient about it and while the promoters of these industries might be beginning to get impatient, I feel every care should be taken by the IDA, or whoever is responsible for the establishment of industry, to check the credibility and bona fides of people coming here seeking State assistance for the establishment of industry. While the lesson of Potez and other unfortunate cases is that caution is needed and the most careful examination called for, nevertheless the whole machinery could be speeded up. I feel the merger of An Foras Tionscal and the IDA into one body will speed up the processing of industrial proposals.

This afternoon the Minister made a special statement with reference to Potez. It is an interesting statement. It will do a lot to clear the air and end the confusion that has been in the public mind in regard to Potez. I stated here on previous occasions in regard to the Potez company at Baldonnel that I could not understand on what grounds approval was given for the manufacture of aeroplanes the first day. I am not an expert on aviation. I know a little about it. I have contact with it by reason of the fact that Shannon Airport is very close to my constituency and a considerable number of my constituents are employed there. The information I got as a result of inquiries I made from people in aviation is that at the time the proposal was submitted to the IDA for the manufacture of an executive aircraft, the Potez 840, it was regarded as a new type of aircraft which had not been produced commercially up to then.

At the time Potez came here the type of aircraft they proposed to manufacture seemed to have a very good potential. But, unfortunately, by the time the proposal was processed and by the time the factory could be got into operation, other aircraft manufacturing [1616] companies, particularly in the United States, had developed an even better executive type aircraft. The Americans had developed their aircraft industry to the stage where this type of aircraft could be fitted with jet engines. The result was, as far as I can gather, that at about the time Potez would be going into production with the 840, it was no longer a new development and would no longer be a commercial proposition.

I would express the hope that the Minister's efforts to make the Baldonnel plant a viable unit will be successful. I understand it is now intended to engage in sub-contracting for other aircraft manufacturers. My sources of information in the aviation world tell me there is a good potential for this type of work, and what the Minister says regarding the future for sub-contracting work at Baldonnel would seem to be correct. There is the problem of having a trained work force and building up a reputation for quality work, and of course it would have to be a profit-earning project.

It is a very large plant. The employment project is 150 in a couple of months time, eventually leading to 250. This seems a very small figure for a huge plant of this kind. Maybe the Minister will be able to throw some light on the matter. I am not being cantankerous or political about this. Admitting that a mistake has been made, I would like to see the plant utilised fully. If we accept 250 as the maximum employment potential for this plant engaged in sub-contracting work, surely these 250 workers will not utilise the entire space of the plant? Is there any intention to section off the plant? Is there any possibility of getting any other type of production going in any other part of the plant?

The Minister referred to Córas Tráchtála and to the need for maintaining pressure in the matter of exports. I think Córas Tráchtála are doing a very good job but I am wondering if the job they are doing is sufficient to meet the needs of the future. When one takes into consideration the type of export promotion operated by countries more advanced than ours at present, one wonders whether our [1617] export board are sufficiently geared to meet the intense competition in the export market that is going to arise not in the distant future but in the immediate future. I am wondering whether the Minister is satisfied with the scope and activities of Córas Tráchtála at present and whether, in conjunction with his review of the whole field of industrial development, he intends to have any examination carried out with a view to extending or streamlining the activities of Córas Tráchtála. Córas Tráchtála are doing a good job and will play a clear role in the future of the country.

I raised a few points in the Minister's absence which I hope will be brought to his notice, particularly in regard to the extension of the facilities of the Shannon Industrial Estate to Limerick. I pointed out that there was an announcement in the newspapers in the past week or ten days. We in Limerick believe nothing we see in newspapers and we wanted to know whether it is a fact that the Shannon Development Company have taken an option on a 60-acre site at Raheen, three miles outside Limerick, and if so, what plans have they to proceed with the erection of a factory on that site?

Mr. Colley: I think it was Deputy O'Leary who pointed out that we had a debate in the last few weeks on the Industrial Grants Bill during which Deputies ranged over a wide variety of matters which would normally be discussed on this Estimate. Since we had that debate so recently, the debate today has been perhaps more curtailed than usual on this Estimate and I hope my reply will be similarly curtailed. Perhaps I shall deal first with the point raised by Deputy T. O'Donnell. It is true as was announced by the Shannon Development Company, that they have acquired an option on a site at Raheen and also that they are going ahead with the necessary arrangements to enable them to build factories there. They are not confining themselves to Raheen. They have, in fact, plans for fairly quick action in other areas. I cannot say any more at the moment but I want to confirm that this is so.

[1618] I think I have said before in the House that I believe the executives of the Shannon Free Airport Development Company regard this assignment as a tremendous challenge which they are determined to meet and overcome and from what I know of them, I think they will do that. I have every confidence that they will. Their whole approach to the assignment that has been given to them is very encouraging, not only for the people of the region of Limerick, Clare and North Tipperary but for the country as a whole, because the development of a large-scale industrial complex in that area is very important to the future of the economy of the country.

In regard to the Potez factory, I want to say, first, that I appreciate the manner in which Opposition speakers have met the statement of mine which went as far as possible and was given in accordance with undertakings given not only by myself but my immediate predecessor to the House. Personally, I cannot list, because I was not there, all the factors that entered into the decisions that were made in the establishment of this factory, but from what I know I can say that it is very much easier, operating with the benefit of hindsight, to see now that there were difficulties in the way of that project which certainly were not apparent at the time. The project was being sponsored by a man who had been singularly successful in building aircraft in the past, a man who had made a great deal of money at it. He had a very substantial interest in the plane and, in fact, had got a provisional order for 24 planes from the United States, as I mentioned. I detailed some of the things that went wrong afterwards. All I can say now is that I think it is less likely that this kind of situation would arise now. I cannot guarantee it will never arise in the future but I think that the IDA, like everyone else, learn by experience, and it is now their practice when dealing with a project of substantial size, or even with a small project which involves any degree of advanced technology, to obtain an assessment of the project from consultants who are eminent in the particular field involved.

These people are not infallible, of [1619] course, but we have advice and sources of information available now to the Industrial Development Authority regarding various projects which are probably a good deal better than they were in the early 60s. For that reason I would hope that this kind of situation would be very unlikely to arise in the future.

As regards the employment potential I stated that it was hoped that the employment figure by the middle of next year would be 250 but it is also hoped that later on it would be considerably expanded above that. Again, one cannot be quite certain or guarantee the success of any project and, as I have stated, this operation of sub-contracting within the aircraft industry is subject to normal commercial risks. But allowing for that, the prospects for the project seem to me satisfactory. I am sure we would all be very pleased if we had established there a viable industry, even if not of the same magnitude as originally planned, involving fairly advanced technology for this country and rare skills, as indeed it does, because a number of the workers involved have had to be trained. Some were brought over from England. A great deal of the operation involves training workers in skills which are not otherwise available here at present. Of course, the injection into our economy of these skills is an advantage to us apart from any direct benefit that may arise from the success of the project.

Mr. Crowley: I should like to ask the Minister about these consultants. How will they act? Will they act in consultation with the firm coming in or will they act in a purely advisory capacity to the Minister or the IDA?

Mr. Colley: When I referred to consultants, I was not referring to just one firm or group of consultants. I was trying to convey that in relation to a particular project which was either very substantial or involved an advanced degree of technology on which IDA would not be competent to make an assessment, consultants who are eminent in the particular field concerned for whatever industry is being considered, are brought in to [1620] make an assessment of the project and make an examination. In fact, this is acting in an advisory capacity to the Industrial Development Authority before they make any recommendations as to what should be done about the project, but, of course, the consultants engaged differ from place to place, because all consultants are not experts in all fields.

Mr. Crowley: The only reason I asked the question is that I feel the greatest experts in their own business were the Potez people themselves; if they invested a substantial amount of money, I do not think any consultants would have advised them to do otherwise when they came to this conclusion themselves independently.

Mr. Colley: As I said, I do not know whether or not the procedures of the IDA then were the same as they are now, but in so far as any reasonable precautions can be taken today by the IDA without completely closing down on their function, which is to promote industry, that is being done, and precautions are taken to avoid mistakes. There are various factors involved in a failure other than the assessment of the potential of an industry and of its markets. The management may be inefficient. This happened in a number of cases. Indeed the management may start off by being efficient and there may be changes in personnel which will make it inefficient. One cannot assess this beforehand, and we must accept the fact that in trying to develop industry we must take risks, and to the extent that we want to develop industry on a crash programme basis, we must take even greater risks. This is something which I think we all recognise intellectually, but we may not recognise it emotionally when the crunch comes. We may think of a particular project which fails and say this, that, and the other was wrong, and we may be right in doing that but——

Mr. Crowley: That is the gift of hindsight.

Mr. Colley: That is what I was talking about earlier, especially in relation to Potez: hindsight does present it in a different light.

[1621] I understand that Deputy O'Donnell inquired about the Small Industries Programme and asked whether it was intended to be continued as a permanent section of my Department. This is a technical matter, but the Small Industries Division is a division of the Industrial Development Authority which, of course, operates under my Department. The intention is at the moment that before the end of the year the programme would be extended to the whole country. In the light of the experience we have achieved with it, we might make some changes because, as I said when introducing it, we expected to make mistakes in this, because it was something of which we had no experience. We were starting from scratch and therefore would expect to make mistakes. The whole idea of a pilot programme was to learn by these mistakes. I hope to extend it to the whole country by the end of this year, but I would also hope—and this is not a statement I am making as a matter of Government policy but rather as a personal hope, because the whole thing has not been assessed yet—that if, when it is extended to the whole country, it is as successful as I believe it will be, we might then go on to a further stage which would be the development of another programme or else the extension of the Small Industries Programme to industries on a somewhat bigger scale both in employment and in capital. They would almost all be Irish industries, that is, industries owned and run by Irishmen, not all but almost all. There probably is considerable need for a programme which is geared specifically to the requirements of what we would term medium-sized industries in this country but the first stage is to take the Small Industries Programme, and then see where we go from there.

I want to deny something stated by Deputy Donegan. He was enunciating Fine Gael policy; some of it struck me as a little bit odd, but I am not going to deal with that at the moment. What he was saying or implying was that the programme which we have had, and which we have still, differentiates between foreign and Irish industry in favour of foreign industry. This just is [1622] not so. He said that a foreign industry, which is a new industry, coming in qualifies for an industrial grant, whereas an existing industry which wants to extend used to qualify for an adaptation grant but now qualifies for a re-equipment grant. What I want to make clear is that any new industry whether it is promoted by foreigners or promoted by Irishmen, is entitled to exactly the same treatment. Similarly in the case of re-equipment grants; these are available on exactly the same terms both to Irish firms and to foreign firms which are operating here at the moment. It is comparing two things which are not alike to be comparing a grant for the extension or re-equipment of an industry with a grant for the establishment of a new industry, and this is what Deputy Donegan was doing.

In regard to Córas Tráchtála it is my belief which has been very much strengthened by comments which I have heard from people from other countries who know about these things, that Córas Tráchtála are one of the most effective export boards in the world, if not the most effective. I have seen the service which they have given to our exporters in places abroad and in circumstances in which I was able to compare it with what was being done by national export boards of other countries for their exporters in the same place. It was obvious to me that some of the other countries concerned were spending a great deal more money than Córas Tráchtála were and perhaps making more of a splash. The whole thing looked a bit more sophisticated than ours, but after a day or two the exporters from other countries were coming along to our exporters and telling them how much they envied the service they were getting from Córas Tráchtála, which when you get to that stage of the selling operation does not really concern the expenditure of money or elaborate set-ups in, say, showing goods, but rather in the contacts which are provided with potential buyers.

A great deal of skill and expertise has been built up by Córas Tráchtála in this regard. I do not want to go into their trade secrets, but I can say that [1623] an Irish exporter who, say, goes out on a trade mission with Córas Tráchtála and meets a number of buyers, has a briefing and a code system given to him by Córas Tráchtála, which means that he knows exactly all he needs to know of the various buyers coming in and knows how to approach them, and he is left to do the job which is really his, that is, to sell.

I am very satisfied with the performance of Córas Tráchtála, but this does not mean I think there should not be any changes. Córas Tráchtála are adopting a very flexible approach and are keeping in touch with problems as they arise and changing their approach as these problems arise. I was making reference to the programme which they have launched to induce 1,300 firms in this country who are potential exporters and who are not exporting to induce them into exporting. I think they are approaching this whole programme in a very intelligent way. I believe the results of what they are doing will be very important for the firms concerned, and our economy in general. I have no reason to believe that Córas Tráchtála have become hidebound, or that they are not prepared to change their attitude where that seems to be necessary.

Deputy O'Leary spoke in a much more restrained way today than he usually does on this subject. Perhaps for that reason I was a little more impressed by what he did say. I agreed with a great deal of what he said. In particular, I should like to point out to him that I think he is operating under some misconception so far as the policy of the Government is concerned. He seems to think it is the policy not only of the Fine Gael Party but also of the Fianna Fáil Party to hold up private enterprise as a sacred cow and to refuse to avail of the potential of State enterprise.

I have said before but I will say it again, that we have no doctrinaire belief either in private enterprise or State enterprise. The test we apply in any situation of the kind we are talking about is: what is the most effective way to do the job? There are obviously some areas in which private enterprise is far superior to public enterprise. [1624] There are other areas in which public enterprise would seem to be a good deal more effective to do a particular job. There are still further areas in which the ideal would be a partnership between efficient private enterprise and State enterprise. We have already engaged in these three kinds of operations. We have no doctrinal difficulty about this, as Deputy O'Leary suggested.

So far as State companies are concerned, I should like to say to Deputy O'Leary that quite some time ago I instructed such State companies as are engaged in manufacture, and are either under the aegis of my Department or have contacts with me, that I want to see them diversifying and utilising the expertise which they have — and they have a great deal of expertise—with the objective of setting up new industries and creating new and viable jobs. I think there is considerable scope for this, and, I do not think it need interfere with private enterprise, but if it does, and if it is a question of doing the task of providing more viable jobs more effectively, I will not hesitate to urge our State companies to get into that area and do that job.

I believe—I said this before—that the most important matter for us is the creation of new jobs in reasonable conditions. This applies not only to the areas I have already mentioned but also to the interests with which private enterprise is concerned. I do not subscribe to the view that private enterprise is entitled, while not doing the job itself, to do a dog in the manger act and prevent the State enterprise from creating new jobs for our people. The main objective is the creation of more and more new jobs in reasonable conditions. In achieving that in any area of activity, the test I apply is: which will be the most effective way to do it? That is the only test.

Deputy O'Leary made some reference to firms, particularly foreign firms, closing down without notice. I want to say that I deplore and condemn the action of any firm, Irish or foreign, which closes down with no notice or minimal notice to its workers. I find it difficult to visualise circumstances in which the financial situation of a company [1625] can become so acute almost overnight that it has to close down without notice to its workers. That type of action reflects a complete disregard for the rights of the workers in the industry. This is a disregard which we cannot continue to tolerate for too long, because it reflects the worst aspect, or one of the worst aspects, of a situation which leads us into bad industrial relations.

In introducing the Estimate, I talked about the importance of good industrial relations to the development of our economy and, indeed, to the achievement of full employment and a reduction of emigration. Good industrial relations are vital in all these matters. There are many causes of bad industrial relations, but one of them is this total and utter disregard for the rights of the workers in factories, and the treatment of them as if they were machines to turn off like that. If there is evidence of any further approach of this nature by the owners of industries, whether they are Irish or foreign, I feel it will be necessary for the Government to consider enacting legislation which will prevent this happening. I do not think there is anyone in this House who would approve of that kind of action, and I do not think there is anyone in this House who would oppose legislation which was necessary to deal with that situation. It raises difficulties I admit, but the effect of this kind of action is so far reaching that it seems to me that, despite the difficulties, we may well have to consider taking action to deal with a situation like that.

In general, I cannot say that I am happy that we are achieving our targets for employment, because we are not achieving them. The reasons why we are not achieving them are perhaps quite complex, and everyone would not agree on what those reasons are or, indeed, the relative importance of the different reasons. We can agree that we are not achieving our target. At the same time, we can also realise that the situation is not nearly as bad as might be suggested by some speakers in this regard. I want to make it clear that while the development of industry is the key to the creation of new jobs, this does not mean that new [1626] jobs will be created in industry only. Indeed, one of the problems which arose and which was not solved until the census was taken in 1966 was that the projections for employment envisaged, as far as I can remember—and I am speaking now from memory—that the bulk of the new jobs would come not directly from industry but rather from the sector of the economy engaged in non-manufacturing and non-agricultural—that covers distribution which is the main item but there are lots of other categories such as administration and commercial activities of various kinds—and for some reason our statistics from year to year, between 1961 and 1966, were based on samples and projections which did not show any substantial growth in this area at all.

However, when the census was taken, it was discovered that there had been a fairly substantial growth in this area and this was an indication that we were reaching a level of development which was getting close to what we would all like to see. The pattern of development in other countries has been that when you get fairly close to what you might call maximum development, you get a very substantial increase in the number of jobs created in the category of industry that is nonagricultural and non-manufacturing. The results of the census show that over that five-year period, from 1961 to 1966, there were 12,000 new jobs created on average in each of those five years, not all of them of course in manufacturing industry. It is important that the House should realise that the creation of new employment is something that involves an interrelation between manufacturing industry and the rest of the economy.

In regard to the creation of new jobs in industry itself, it has been said that we have not been successful in attracting really large-scale industry or industry of the kind that has considerable growth potential. This is probably substantially true and again it is a reflection of the stage of our economic development as it has been. I should also say, without making any commitments or promises or anything [1627] else, that there are at the moment in the pipeline some quite substantial industries being promoted by people who are in the front line of their particular fields in international business. The fact that they are in the pipeline is a reflection of the development which is taking place in our economy.

I do not say that these things are going to cure our unemployment and emigration problems overnight—of course they are not—but it is an indication that we are going in the right direction, but we have to step up our efforts and be quite prepared to approach some of these problems in quite a new and radical way, if this is necessary and if it would seem to pay dividends. I hope that in the coming year, between now and the next Estimate, I will have demonstrated that this is so, that we are prepared to do this and that the results which will attend our efforts will justify that kind of approach.

Vote put and agreed to.

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