Billy Kelleher (Cork North Central, Fianna Fail)

I propose to take all the questions together.

I fully share the Deputies' concern regarding the announcement by the company in question that it is facing liquidation and the impact of that decision on its employees. The company announced the appointment of liquidators in a press statement on Monday, 12 April. I understand that the liquidators are carrying out an initial assessment and will speak with employees, suppliers and customers in the coming days. The Government and the State development agencies await the outcome of the meetings between the company, union representatives and the liquidator. The efforts of the agencies will be geared towards saving as many jobs as possible, including any possible assistance in the event of any management buy-out options.

This company has been a significant employer in County Westmeath since 1964. It would be extremely disappointing were operations to cease at Collinstown and particularly devastating for the workers and families directly affected. I understand the company had incurred losses for the last three years and, although some strategic investment was under way, had projected losses for 2008 and 2009. The company's business plan projected a turnaround in 2010. The success of this business plan would have secured employment in Collinstown for the medium term, albeit at a reduced level.

The company recently informed the Industrial Development Authority, IDA, that jobs were at risk if specific industrial relations issues in regard to pay increases could not be resolved. Additional funding was also needed to proceed with the investment it had planned in the Ukraine, which was crucial to the future of its Irish operation. The timeframe on this decision was immediate. The IDA was already engaging with the company and had offered to assist by lending its support to resolve the industrial relations situation through discussions with the union at senior level and discussions with shareholders.

Subject to the resolution of the industrial relations and funding issues, the IDA had confirmed to the company that it would consider support for training, consultancy and research and development, based on its future business plan in Collinstown. The IDA also offered to assist if the company decided to seek investment from equity or industrial partners and to work with Enterprise Ireland in the case of an indigenous shareholding investment. However, despite the input of the Labour Relations Commission and IDA Ireland, which made every effort to avert this development by negotiating with the company on a package of incentives geared towards trying to maintain the business for the future, this approach has unfortunately not borne fruit. When the Minister, Deputy Martin, contacted the company directly, he reiterated that the Government agencies remain available and willing to provide any assistance or take any steps to ensure the company remains in production on terms satisfactory to the management, unions and employees. Deputies O'Rourke, Johnny Brady, Penrose and Bannon have been in continuous contact with the Minister on this issue since the bad news broke. Senator Cassidy raised the matter this morning in the Seanad.

I assure the House that IDA Ireland is in ongoing contact with the company and will continue to work closely with its representatives during this challenging period. IDA Ireland will meet members of the family that owns the company tomorrow to discuss this issue further. The Minister, Deputy Martin, has said he is also available to meet the owners of the company to discuss the matter. While I am conscious of the effect job losses have on the workers involved and their families, as well as the local community, I assure them that the Government will make every possible support available to develop new employment opportunities. The role of FÁS, which is the State training agency, will be particularly important in assisting people if jobs are lost. FÁS will be available to provide advice and training opportunities for the Iralco workforce. The agency will make its full range of support services available to the workers. It will work on reaching top-level agreement with the company on responsibilities and actions. It will engage in intensive interviews, individually or in groups, with affected workers to outline the range of supports and services available. FÁS will prepare a skills analysis report based on the identified needs of workers and local opportunities. It will refer the affected workers to jobs, training courses and other options. It will establish special or customised training courses, where necessary. It will offer ongoing support and action to keep redundant workers in touch with the labour market.

The Government, through the State development agencies and other interested parties, adopts a co-ordinated approach in dealing with job losses. Such bodies work together to make the employees aware of the supports available to assist in finding new employment or starting their own businesses. The Minister for Enterprise, Trade and Employment has pointed out on a number of occasions that there has been, and continues to be, a significant churn in employment. The effects of globalisation are felt in the smallest markets and global competition will intensify and extend its reach. The Government has recognised the inevitable changes taking place across the world in the areas of trade and investment. Enterprise policies that equip companies with the ability to better compete in world markets, capture the opportunities presented by globalisation and build a competitive advantage in innovation and knowledge have been central to policy development. The best response to globalisation is to ensure Ireland remains attractive for investment and enterprise growth.

As the economy has matured, foreign direct investment incentives have been tailored to match our strengths. As low wage costs are no longer an enticement, they have been replaced by other attractions, including a competitive tax and regulatory environment, a better educated workforce, an improving infrastructure and a commitment to world-class standards of research, development and innovation. Maintaining and improving upon these standards is vital to sustaining Ireland's competitiveness.

IDA Ireland is working to develop the knowledge economy in the midlands region, which was mentioned by Deputy Bannon, so it can compete nationally and internationally for foreign direct investment. In the past five years, the agency has been promoting counties Longford and Westmeath as part of an integrated midlands region with a population base of more than 310,000 people. The counties have traditionally been a centre of manufacturing for foreign direct investment but, like other counties, they have seen a number of closures within the multinational sector as global investment shifts to low cost destinations. In response, IDA Ireland is marketing the midlands gateway of Athlone, Tullamore and Mullingar as a key location for investment in medical technologies, international financial services and ICT, in line with the national spatial strategy and as part of the process of repositioning the region to facilitate a more knowledge-based economy.

Some progress is evident in the midlands region. Companies like Kinetic Concepts, Teleflex Medical, AXA Assistance, Elan Corporation and Alienware Corporation are establishing or expanding their operations in the county. When I was in Savannah, Georgia, recently, I visited the offices of Georgia Tech Research Institute, which has linked up with Athlone Institute of Technology as part of a very interesting concept. The 21 IDA Ireland-supported companies in County Westmeath employ 2,298 people. Enterprise Ireland has 119 companies, which employ over 3,000 people, in the county. The Government is not complacent — it is well aware of the challenges ahead not only in a global context but also in County Westmeath. The Government is investing in the infrastructure needed to attract foreign direct investment to County Westmeath. It is investing €3.5 million in a quality flagship business park in Athlone, which is an integral part of the agency's international marketing programme. IDA Ireland has purchased 70 acres of land at Ardmore in Mullingar. The site has been master-planned and phase 1 construction is complete.

Enterprise Ireland has a number of programmes in place to assist indigenous companies to grow and export. It has invested heavily in Athlone Institute of Technology, which is a key infrastructure element for the attraction and development of enterprise. In February of this year, the Minister, Deputy Martin, announced a €50 million boost to regional economic development. Athlone Institute of Technology is set to benefit directly from this investment, which will support enterprise focused activity in the midlands by funding the purchase of industry-relevant research equipment, providing more incubation space for start-up companies and establishing additional market focused research groups.

The manufacturing sector has been vital to the economic success this country has enjoyed in the past 15 years. The Minister for Enterprise, Trade and Employment recently launched the report of the high level group on manufacturing. The group, which was set up under the Towards 2016 agreement, spent 12 months examining the challenges facing the manufacturing sector in Ireland. It concluded that manufacturing will continue to play an important role in Ireland's economic development, as it has done in the past. Manufacturing is evolving and will be different in the future. It will be even more technologically advanced, knowledge intensive, capital intensive and skills intensive, led by an understanding of markets and customer needs.

We need to ensure that firms are making the changes necessary to be at the leading edge in terms of production processes, global business models, organisational structures and human resources practices. In effect, this means firms need to invest in innovation and mechanisms to increase productivity, reskilling and upskilling their workforces and building a world class management capability that is relevant to an innovative firm operating in a global context. The Government, which established Skillsnet to oversee its strategy of upskilling the whole labour force, is investing in various training programmes. Future successful manufacturing firms will have a participative culture, where management and staff work collectively to ensure the success and long-term sustainability of the firm for the benefit of all. This will involve evolutionary change for some firms, while for others it will mean fundamentally transforming how they do business and organise themselves.

The report acknowledges that a range of policies have been developed to enhance Ireland's business environment so it continues to be a good place to do business. The report calls on the Government to take steps to address the rising costs which have been facing the sector for some time. Energy costs, waste charges, professional services and local authority development charges, for example, have a negative impact on the sustainability of the manufacturing sector. I welcome the recommendation that we should continue to focus on collective action through the establishment of a manufacturing forum. We know what needs to be done. Everyone needs to play a part in making it happen. Manufacturing matters to Ireland's economy and will continue to matter as we move into the next decade.

I am confident that the strategies and policies being pursued by the State development agencies will continue to support enterprise development and job creation in the midlands area. I reaffirm that the State agencies will continue to work closely with each other and with local interests to assist an integrated approach to investment and enterprise development in counties Westmeath and Longford and the adjoining areas. The Government is committed to using all the State agencies to secure as many jobs as possible at Iralco Limited. There has been high level contact with the unions, management and owners of the company. We have to deal with the challenges associated with the competitive global market. We understand the impact job losses can have on families and the broader community.

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