Dara Murphy (Cork North Central, Fine Gael) | Oireachtas source

I thank Deputies Lowry and Coonan for raising this very important matter of great concern for the people involved. As they will be aware, Bord na Móna is facing significant business challenges in the context of the deregulation of the electricity market and increasingly competitive and challenging environments across all its business areas. In order to ensure its continued success, the company is implementing a programme to transform all areas of its operations and structure, the key objective of which is to improve business effectiveness and efficiency.

The specific matter raised by both Deputies in regard to terms and conditions of employment is an operational matter for the company and not one in which the Minister, Deputy White, has any role or function. He passes on his apologies for not being here. Furthermore, taxation policy, including the carbon tax, its implementation and impact, is a matter for the Minister for Finance and not one in which the Minister has any function.

However, I understand that the Minister, Deputy White, has raised the wider issue in regard to peat production with Bord na Móna and has been advised that the temporary cessation of peat briquette production is confined to the two factories at Littleton, County Tipperary and Derrinlough, County Offaly. Both factories are peat-based manufacturing plants, producing Bord na Móna peat briquettes and run on a 24-7 basis during production. Each year, based on sales requirements, Bord na Móna implements a specific production plan for each of its factories. The plan normally includes periods where production ceases, there is maintenance overhaul and where there is annual leave, including a break in production over the Christmas period without, normally, loss to employees. I understand, however, that as a result of very mild weather in recent months, competitiveness challenges, a high private timber and sod turf supply and falling prices for home heating oil, the opportunity for the company to sell its current stocks is unfortunately very challenged this year.

As the Deputies will be aware, in December last, affected employees were informed of the seriousness of the stock situation at the factories and production temporarily ceased over the Christmas holiday period. While production recommenced in early January, it became apparent by early February that stocks were again building up due to continuing lower sales levels. Formal communications took place with staff and union representatives in February and the company advised that production at both plants would cease at the end of March until early September. It was further agreed that plans were to be prepared for each factory to manage the shut-down in the most efficient manner possible.

The company is running the normal maintenance overhaul at both plants during April and no employees are laid off. Following this, holiday leave will be scheduled. Thereafter, I understand that unfortunately it will be necessary to lay off a number of staff in June and July. Management is actively considering all options to mitigate the impact on directly affected workers through redeployment of people to security duties, bog operations, other areas of the company or outside contract work as well.

At all stages staff and union representatives have been kept informed of the situation. The restart of briquette production is scheduled for 10 September next. In the meantime the company is actively reviewing new product development opportunities and engaging with local management and staff on trying to grow new markets for peat products.

The Minister is aware of the seriousness of the situation and would encourage management and staff to work together in managing this very difficult period ahead while looking forward to the restart of production at the earliest possible date.

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