Adjournment Debate. - Waterford Paper Mills Closure.

Wednesday, 11 October 1978

Dáil Eireann Debate
Vol. 308 No. 1

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Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Waterford city has a population of 35,000. Today's unemployment register indicated that there are 2,300 people there in receipt of benefit. That must be one of the highest unemployment rates in the country, if not the highest. I appeal to the Minister to do everything he can to help the city retain its existing industries which are working on short time or which are in financial difficulties and to revive some of those industries which have gone to the wall recently.

Since 1973 there have been 18 industrial closures in Waterford city resulting in over 3,000 redundancies. Those figures have been provided to me by the local council of trade unions and I have no reason to doubt them. I believe [178] the total is nearer 3,500 redundancies. In the meantime the new jobs created have only amounted to 1,100. This is an alarming state of affairs and it is little wonder that Waterford has become known as the industrial graveyard of Ireland. Since 2 October 500 people have been added to the unemployment register. This is due entirely to the closure of the National Board and Paper Mills at Grannagh where 281 jobs have been lost together with a strike which resulted directly from that closure in the sister box factory, where 220 people are employed. No doubt those 220 jobs will be retained. I appeal to the Minister to ask the Minister for Labour to intercede as soon as possible because this strike seems to be an inter-union dispute. I believe there is a “fire brigade” action effort in the Department which deals with this type of dispute within a matter of days. No action has been taken so far in relation to this strike by the Department of Labour.

Waterford has had a history in recent years of industries coming but actually never arriving. People are beginning to think that Waterford has been forgotten as an industrial centre. Earlier this year an industry to be known as Modern Plastics, which was to employ 120 people, was to come to the industrial estate. People were actually notified that they would have to go to an AnCO centre for training, but the industry never started. The excuse given was that they got better terms from the UK Government to set up in the UK. I appreciate that that is a common complaint. We seem to be outbid again and again by the British when it comes to giving incentive grants. We saw recently that the De Lorean Motor Sports Car Company, which was supposed to come to Limerick, was moved to Belfast because the incentives were far better there. Mr. Killeen of the IDA said that it might not have been such a good proposition but we will see if that venture is successful. We have not got any replacement industries for those 18 closures and the people in Waterford are looking for a number of replacement industries. No new industry which has come along in the meantime has succeeded in absorbing the large labour pool which is available.

[179] Three months before the present closure an IDA officer told public representatives and trade union officials in Waterford that there were so many industries in the pipeline that soon Waterford would not have a sufficient work force to supply all the potential jobs that would be available. It is sad to relate that the position far from improving has worsened considerably.

I would like to express my appreciation to the Minister for having received a deputation on this matter about six weeks ago. It was not an easy deputation to handle because it was probably too large. The Minister gave them very good treatment and was very sympathetic to the views put forward. I understand that the Minister had a similar problem in Limerick, although possibly it is not as great as the one in Waterford. However, we feel that his ministerial status will solve that problem fairly quickly. We hope we will not be left in the lurch in view of troubles elsewhere.

A major part of our problem in Waterford is a lack of proper infrastructure in and around the city. Industry is quite often attracted by facilities, amenities and a very good infrastructure. At the moment Waterford is so bad in this regard that it puts industrialists off. That is why it is so important to retain existing industries. We badly need a new bridge. There has been a call in Limerick recently for a third bridge. There is one bridge in Waterford which needs to be closed down periodically it is in such a bad condition. We are ten years looking for a new bridge but have not yet been successful. The roads leading out of the city, especially those leading to Dublin and New Ross, are very bad. All those things are important when an industrialist comes to look at the facilities available.

We have no airport, which is another great handicap. The Minister should bear those infrastructural deficiencies in mind when thinking of providing new industries in Waterford and in conjunction with the Minister for the Environment attempt to rectify the position. We are lagging behind the rest of the country in these matters and the people of Waterford feel they are not getting their share [180] of the national cake. They want those infrastructural deficiencies rectified as soon as possible.

I see in today's paper that it has been advocated that a second oil refinery is needed. There is no place more suitable than Waterford harbour for such an industry. We have a power station at Great Island which depends on oil to generate power. An oil refinery would be an obvious complementary industry in a case like that as it would eliminate a great deal of shipping and expense in bringing the oil from elsewhere. We would appreciate the setting up of a Government Department in Waterford city as has been done recently in Castlebar and Athlone. I do not believe that those two areas are as depressed as Waterford city at the moment. This would obviously give considerable employment not alone in the Department but in associated services.

A march in which 20,000 people took part took place in the city last month to demonstrate the frustration of the people at the closures to which I have referred. The people are demanding that something be done to stop the growth in unemployment. I know that the Government have forecast a major increase in the number of jobs to be provided over the next five years. I know their target for 1978 will not be reached. I am not here to criticise them in relation to that, because if they do their best they cannot be blamed. We might blame them for making promises they cannot fulfil but we appreciate their difficulty. However, if there are new jobs to be given out and if there are new industries to be promoted, Waterford should be given priority because of the dreadful unemployment situation.

Eighteen industries in all have gone to the wall since 1973. Goodbodys employed 490 and they have gone out of production. Dennys, the bacon curers, employed 300 people and they have stopped production. Crokers printing works employed 80 people and they also have gone out of production. There is a litany of similar industries gone out of production, not all as large as the ones I have mentioned but all fairly substantial employers. Some of the existing industries are on short time. For instance, [181] Munster Chipboard are presently surviving on aid given to them by Fóir Teoranta. When Wellworthy came to Waterford we were told they were supposed to employ 1,000 people, but due to local and other problems they are only employing 80 people. This sort of setback has been depressing. Milton Bradley, which is a new industry, have recently had to stop working one shift, which has resulted in a reduction in employment. There is a series of short time, cutbacks in shift work and closures which is very depressing.

The reason I have asked for this debate is that the recent closure has shaken the city to its foundations. The paper mills were regarded as a stable industry and were expected to last for a considerable time. It was a money-making proposition but it seems that the parent company, St. Jo Paper Company of Florida, decided to close all their ventures in western Europe, which meant that the Waterford industry went to the wall. We believe that the box plant and the mill have been purchased by Ulster Paper Products of Craigavon, Northern Ireland, but we are not sure of their intentions. We do know that they do not propose to continue with the paper mill, which is the manufacturing end of the business. We are told that they are going to keep the box plant open, which should retain 220 jobs, but we are not sure. We would like the Minister to do everything in his power to ensure that this plant is not closed. It is bad enough to lose 280 jobs without losing a further 220. It is a well-known gambit in industry for a company to buy a number of such plants and then to close various sections of them for financial reasons. Ulster Paper Products have also bought the Killeen Paper Mills in Dublin. There is a fear in Waterford that they will close down the Waterford section and concentrate their efforts in Dublin or transfer the operation to Craigavon.

We should also like to know what prospects the Minister has of getting a new owner to take over the existing board mill at Grannagh and if he has hopes of this industry reopening soon. It is a viable concern, we are told. We have also been told that interested companies [182] are negotiating to purchase it. I know there has to be a delay because the deal between the St. Jo Company of Florida and Ulster Paper Products may not be complete. Once Ulster Paper Products take over the complex, we would appreciate it if the Minister would use his good offices to ensure that the mill section is sold to some company that will operate it as heretofore.

We believe that the mill should not have been allowed to close. When our deputation visited Dublin we asked that the IDA, in conjunction with Fóir Teoranta, move in and keep it going until new operators were found and we are disappointed that continuity was not maintained. We hope that it will be reopened as soon as possible after it has been purchased. It was stated by a member of the deputation that the equipment in the mill was obsolete and would have to be replaced before it could be operated on a profitable basis. That opinion has been contradicted on a number of occasions by people working in the firm. They tell me that the existing mill and equipment could operate and that it could be replaced in phases without closure, and I would ask the Minister to bear that in mind.

Waterford is in a depressed state at present. We have a few stable industries which are giving good employment. Waterford Glass, Clover Meats and ACEC are major industries providing stable employment in the city. We need at least one more major industry. We do not want to see any further closures and we want to see the National Board and Paper Mills continue to operate. Between the deputation and advice from his officials, I am sure the Minister is aware of the position. We are thankful for the reception given to the deputation and we hope he will continue to work on our behalf.

Minister for Industry, Commerce and Energy (Mr. O'Malley): Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  I have been looking at the figures for industrial employment and the figures for registered unemployment in Waterford, and the actual figures do not appear to bear out what Deputy Deasy has been saying.

[183]Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Those figures were supplied to me by the Council of Trade Unions in Waterford and are at variance with the figures being supplied by the IDA.

Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  The offical figures, whose accuracy one cannot doubt, appear to paint a different picture. Waterford is a city in which there is a large amount of first-class industry and I am surprised to hear it described as an industrial graveyard, because it certainly is not. I wish that other comparable places were as well served in so far as industry is concerned as Waterford. The figures show that in the past year or so there have been closures of two industrial plants in Waterford, one is the National Board and Paper Mills board mill, which closed at the end of September 1978 with a loss of 280 jobs, and the other is Industrial Packaging Machinery Ltd, which closed in May 1978 with a loss of ten jobs, making a total loss in a period of over 12 months of 290 jobs. The IDA's annual employment survey, which is carried out on 1 January each year in each city and county, shows that there were 480 more people employed in Waterford city in manufacturing industry on 1 January 1978 than there were on 1 January 1977. The figures for the last four years show a small improvement in the first three years and a major improvement in the past year because they have gone from 6,360 to 6,453 to 6,603 to 7,082, and there has been a corresponding drop in the number of people registered as unemployed. The last date for which official figures are available is 22 September 1978 when the figure was 1,759.

Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Today's figure is 2,300.

Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  It could not be that because today's figure would not be available. In any event, if people are on strike the normal practice is for them to be registered as unemployed. The figures for the corresponding dates in 1976 and 1977 show a drop from 2,019 to 1,941, now down in this September to 1,759.

Waterford is in the fortunate position that the IDA own a good deal of land [184] there unlike the position in many other areas. This has been a tremendous help and is one of the reasons why so many new industries have come to Waterford in recent times and why so many major ones are projected for Waterford in the immediate future. Among those just about to start are the National Can Corporation which will shortly come into production and will employ 110 people. Tech Industries recently commenced production and expects to employ 100 people in full production. Hi-G Corporation recently concluded negotiations for a project which will employ 160 people. The construction of their factory is nearly completed. Fismar and Co. Limited are undertaking an expansion of their operation and the construction of an additional 20,000 square feet has started and this will increase the employment to 140. The Garrett Corporation recently commenced construction of a new factory in Waterford and expect to be in production at the beginning of 1979 and to employ 138 people. A German company recently concluded negotiations with the IDA, as will be announced within the next week or two, providing employment for 100 people.

In addition, I think it is fairly well known in Waterford, as it is in other parts of the country although I cannot officially refer to it here, that there is a major new industrial development which I believe has actually started already but which cannot be officially announced for some weeks because it has to be technically passed by the Government because of the very high grant level involved. I do not mean the grant rate but the total amount. That will employ over 1,000 people and it is an extremely reliable industry.

Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Has this industry been announced? The 1,000——

Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  No.

Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  But it will be shortly?

Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  Yes.

Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Good.

[185]Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  When one sets out these facts, speaking if I may for a moment as a Limerick man—indeed the Deputy raised that matter and made comparisons—I would willingly swop with him any day as regards industrial development because, unhappily, the situation in Limerick is worse and the outlook not nearly as good. In Waterford the position is one of constantly rising employment and some major new firms, not mickey mouse firms in any sense but firms with high technology and high quality employment are involved which certainly will continue to boost Waterford.

I do not know if the Deputy's figures about closures since 1973 are correct because the figures supplied to me do not go back that far but there have been only two in the past year; so, if there were 16 others they were all in the years 1973 to early 1977, which I suppose speaks for itself to some extent. I am not aware that there are serious infrastructural deficiencies in Waterford and if there were I suppose it would be a matter beyond my personal control, but in so far as deficiences exist I do not think they are any worse than in other comparable places. In fact, the availability of suitable sites and the general infrastructural attraction of Waterford is one of the reasons it has done so remarkably well in attracting new industries.

The Deputy referred particularly to the recent closure of the board mill section of the National Board and Paper Mills at Waterford. I am of course, as he knows and says, fully familiar with all the problems and difficulties in relation to that. I should like to make a general observation on the circumstances under which the owners of that factory decided to close the board mill. I regard it as an unacceptable action on their part. It was not justified by any commercial consideration and where commercial considerations did not force an action of that kind to be taken it is socially very undesirable that any firm should act as they did. In my opinion they acted without any sense of the responsibility which they owe to the place in which they operate and to people who have worked in many cases for perhaps 20 or 30 years in the factory.

[186]Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Hear, hear.

Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  Happily, actions of that kind in this country by manufacturing industry, whether domestic or foreign-owned, are rare, but when we encounter a particularly objectionable action such as that of the St. Jo Paper Mills of Florida in this case we are entitled to comment on it and to say how strongly we deplore such irresponsible action. The mill has closed since 30 September. Unfortunately, the other part of the operation, the corrugated containers part of it, which was not affected by the decision in regard to the mill, is closed because of a strike. My information is the same as the Deputy's, that it is an inter-union dispute. I know enough about inter-union disputes and their consequences to deplore this particular one. I do not know the merits or otherwise of the case and I am not interested but it appears that it is of such a nature and I earnestly hope the Irish Congress of Trade Unions, the only people who can effectively do anything to police this kind of situation of internal disputes, will try to bring that dispute between two unions to an end so that the corrugated container section of this plant can reopen.

Mr. Deasy: Information on Austin Deasy  Zoom on Austin Deasy  Would the Minister request them to intervene immediately?

Mr. O'Malley: Information on Desmond J. O'Malley  Zoom on Desmond J. O'Malley  I trust they will be able to do that without my request but in so far as it is of any value I certainly make that request.

The IDA are engaged in discussions with the firm from Northern Ireland mentioned by the Deputy and with a third party, a Republic of Ireland firm. The IDA plan is to have each of these two taken over by the two firms concerned and have both reopen in due course. The co-operation of the unions and the workers will help greatly in bringing about that situation which it is my earnest wish will be brought about at an early date.

The Dáil adjourned at 9 p.m. until 10.30 a.m. on Thursday, 12 October 1978.

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