Adjournment Debate. - Job Losses.

Wednesday, 17 October 2001

Dáil Eireann Debate
Vol. 542 No. 3

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Mr. Penrose: Information on Willie Penrose  Zoom on Willie Penrose  I thank the Ceann Comhairle for allowing Deputies Naughten and McGrath and me to raise this important matter and the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Kitt, for taking the debate. Like many of the employees who learned that they would lose their jobs at the William Hill betting centre in Athlone, I, like my constituency colleague, was extremely shocked by the news. There had been a number of significant tax changes recently in the betting and levying areas which I thought would be helpful in securing such employment and this added to my sense of shock. However, that was not to be in this case.

The William Hill operation employed approximately 150 permanent and 150 temporary staff. The loss of 300 jobs is a major blow to the workers involved as well as the general economy of Athlone and its hinterland. The telebetting centre processed bets for customers in the United Kingdom and continental Europe and the punter who placed a bet in this fashion avoided having to pay high UK betting taxes. The centre only opened in January 2000. At the time it was viewed as a significant coup for the region that a major player in the betting industry such as William Hill chose the midlands and the move was welcomed by many of us at the time.

The British Government has reacted to the incentive for bookmakers to locate in Ireland by abolishing the 9% betting tax for punters from 1 October and imposing a 5% tax on their cumulative revenue. The staff of the centre will continue to work in the short term, but that does not soften the huge blow that the dedicated and diligent staff of the William Hill centre have suffered. Many of them have mortgages, loans and other commitments similar to thousands of workers throughout Ireland.

I am concerned, however, that a simple change in fiscal policy in a neighbouring jurisdiction could have such a significant adverse impact on the jobs of workers in this jurisdiction. I take seriously the comments of Stewart Kenny who has warned that three times the number of job losses that occurred in Athlone may well happen in the near future without reform of our betting tax regime. I ask the Minister of State to use every agency at his disposal, including the IDA and Enterprise Ireland, to find a new employer for the centre. It is an ultra-modern facility located beside a good transport network and I have every confidence that if the political will is there, a new tenant can be found and these workers and Athlone town can recover from this blow.

Mr. McGrath: Information on Paul McGrath  Zoom on Paul McGrath  I thank the Ceann Comhairle for allowing Deputies Penrose and Naughten and me to raise this important issue. The loss of 300 jobs is a major blow to the economy of any town and the families involved. The recent announcement by William Hill that it was to close its facility in Athlone came as a great shock. UK betting tax which had stood at 9% compared to a rate of 5% here was abolished with effect from 1 October and it had to be expected that companies such as William Hill would leave Ireland. The workforce at the centre comprised 150 permanent and 150 temporary staff. The Minister of State can imagine the devastation suffered by those employees and their families. Many of them left other jobs to join the William Hill organisation in the hope they would be in secure employment with a major player in the betting industry. Unfortunately, everything has crashed around them. These employees were part of a happy, competent workforce, but they do not know what the future holds for them.

The William Hill organisation is putting forward meagre redundancy packages for the workers. I ask the Minister of State to intervene in this regard to ensure they receive a reasonable pay-out. The job losses constitute a double blow for Athlone because the premises used for the centre was established under a business expansion scheme. This had been established by the chamber of commerce and a local builder developed the site. Consequently, many investors may also lose out. Recently 30 jobs were lost at Mallinckrodt Laboratories while Ericsson announced the loss of 22 jobs. However, the workers who leave these two companies will be [725] able to avail of voluntary redundancy. Whenever somebody loses his or her job, it is blow to the individual and his or her family.

I ask the Minister of State to examine the possibility of establishing a task force to review the provision of additional or replacement jobs in Athlone.

Mr. Naughten: Information on Denis Naughten  Zoom on Denis Naughten  This announcement is a blow to my local town, the local economy, the families involved and the region as a whole, which has been developed as a telesales centre. I hope the Minister of State will ensure the workers are given a proper redundancy package and an alternative industry will be attracted to the centre as soon as possible.

Minister of State at the Department of Enterprise, Trade and Employment (Mr. T. Kitt): Information on Tom Kitt  Zoom on Tom Kitt  I thank Deputies Penrose, McGrath and Naughten for raising this matter and express my sympathy to the employees who are to lose their jobs at the William Hill telephone betting call centre in Athlone. The centre was set up in Athlone in January 2000 to process bets for customers in Britain and Europe. The establishment of the centre created 150 permanent and 150 temporary jobs in the town. The decision to close the facility came after the British Chancellor of the Exchequer recently announced the abolition of a 9% betting tax in favour of a new system based on tax on gross profits. This company did not receive grant aid from the industrial development agencies.

FÁS was in contact with the company on Monday last, 15 October 2001, to advise it of the full range of support services it could offer employees, including skills analysis, jobs placement, guidance and counselling interviews, identification of training needs and suitable training courses. The company indicated that discussions are still ongoing between the management of William Hill Athlone, and William Hill UK, regarding the expected number of lay-offs and the timeframe involved.

IDA Ireland is committed to securing 50% of all new greenfield jobs for the Objective One area, of which Athlone is part. This involves doubling the proportion of greenfield jobs negotiated for these regions. IDA Ireland initially reorganised its internal structures in an effort to ensure the objective will be achieved. This restructuring included allocation of additional staff to its regional offices and allocation of regional responsibilities to key executives in its headquarters project divisions. The IDA further intends to build on this strategy by focusing in the medium term on three regional economic centres: Athlone, Sligo and Waterford. Up to one third of all IDA staff will be based in the regions.

The headquarters for IDA regional development has been moved to Athlone from where the [726] new IDA divisional manager, regions and property, will direct the new regional strategy. The regional director for the midlands and west is based in the new Athlone office in addition to the midlands regional manager. The IDA's healthcare and property divisions have also been transferred to the town. The purpose is to drive growth from within the region and develop this centre as a magnet for growth for the region. These changes will bring the IDA staff complement in Athlone to between 25 and 30 in the coming months.

Athlone has an industrial base of 2,569 people employed in overseas companies and is home to many leading international companies such as LM Ericsson, Elan, Mallinckrodt Laboratories, Lund and Alcatel. The town is also home to the national polymer development centre, which is a £3.8 million development located in an 18,000 sq. ft. IDA unit at the business and technology park, Garrycastle. Recent positive developments include the announcement by ICT Eurotel in July 2000 of its plans for a 100 person operation in the newly constructed advance office facility in the business and technology park. This project is progressing well ahead of target and the company already employs 135 people. The company was approved for a 77 job expansion by the IDA in June 2001. IO Systems Limited was approved for a 34 person expansion of its Athlone facility in July 2000 and MSL also announced an expansion totalling 100 jobs in Athlone last year.

IDA Ireland has indicated, assuming that the William Hill facility is of a suitable quality and the owner's permission is forthcoming, it would be happy to promote the building to overseas investors with a view to securing a new tenant. Enterprise lreland is working closely with its client companies and regional partners in developing and sustaining businesses in the area, enhancing the business environment, encouraging new start-up companies with strong growth potential and assisting Dublin based companies to locate their business expansions in the BMW region. Assuming that the facility becomes available it can be actively referred to by Enterprise Ireland to encourage Dublin based development companies to locate in Athlone.

The development agencies will continue to market Athlone for investment and every effort will be made to secure alternative employment for the workers affected by this closure.

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