Seanad debates

Wednesday, 2 February 2005

7:00 pm

Photo of Marc MacSharryMarc MacSharry (Fianna Fail)
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I welcome the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern. Over the past two weeks in Sligo the consumer goods manufacturer, Saehan Media, a Korean company, announced the latest instalment in its wind-down of the production of video tapes, and redundancies for 70 employees.

That follows on from 80 redundancies the previous year, bringing the total to 150. The Minister of State will appreciate this is a matter of great concern to the people of Sligo and the families who find themselves facing the most desperate scenarios. The traditional manufacturing sector in Sligo has suffered particularly badly in recent years in that Hansons, an old manufacturer, closed two years ago with the loss of 150 jobs, bringing the total losses in recent years to 300.

I call on the Department of Enterprise, Trade and Employment to set up a task force or employment initiative similar to those set up in other parts of the country when redundancies or closures of factories occurred. Saehan Media Ireland Limited is a producer of video tapes and given the natural move in most households to the use of DVDs, the long-term outlook for such companies does not inspire confidence, although Saehan is confident it will secure the future of the company with the latest round of redundancies.

IDA Ireland and the other agencies are working extremely hard and have an exceptional staff in the north west. However, in the context of the significant losses in the traditional manufacturing sector in recent years, it is of the utmost importance that the Minister and his Cabinet colleagues engage with the agencies to inject a renewed impetus into the attraction of foreign direct investment and indigenous manufacturing and service industry to this region. The north west has been highlighted as neglected in terms of the creation of new employment or the attraction of foreign direct investment. However, while as a result of the prioritisation of the IDA, the area succeeded in attracting 50% of all new projects, most are located in the midlands, on the periphery of the BMW region and as close as possible to Dublin and its easy access to foreign markets.

I hope the Minister of State will look favourably on this request given the plight of the families who will be affected when these redundancies occur and those who lost their jobs in recent years. Traditionally, IDA Ireland and other agencies have had difficulty in attracting new foreign direct investment to the area in terms of value added manufacturing and service industry, given the infrastructure deficiencies of the region. While much still needs to be done in this regard, there has been significant improvement due to the Government's commitment under the national development plan. To enhance the great work being done by IDA Ireland, the Minister and his Cabinet colleagues should engage fully in the process to enhance the possibility of attracting the investment of foreign companies and Dublin or city-based indigenous industries which are considering relocation or decentralisation throughout the country.

I appeal to the Minister of State for direct Government intervention with IDA Ireland but the motion does not reflect on the great work being undertaken by IDA Ireland and other agencies in the north west. However, while many groups are looking for their areas to be prioritised, the north west has a particular case given the recent plight of Saehan Media, which announced 70 redundancies, bringing the total job losses in that area to 300 in recent years. I thank the Minister of State for coming to the House and call for the setting up of a task force or initiative for Sligo and the wider north-west area.

Photo of Michael AhernMichael Ahern (Minister of State, Department of Enterprise, Trade and Employment; Cork East, Fianna Fail)
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I thank the Senator for raising this matter on the Adjournment. It was disappointing to hear of the recent decision by Saehan Media Ireland Limited to make 70 workers redundant in Sligo. The company has decided to cease production of large reels of video tape and to concentrate on production of video cassette tapes. The decision to cut production lines, according to the company, was as a result of increased competition from cheaper Far East competition. Finding alternative employment for the workers affected is a priority for FÁS and the State development agencies. FÁS has already been in contact with the company to offer its full range of support services, which include skills analysis, job placements, guidance and counselling interviews, identification of training needs and suitable training courses.

The north west is a priority location for the State development agencies. In recent years, IDA Ireland has been able to attract new investment in emerging sectors such as international services, life sciences, including medical technologies, software and high-end engineering. Employment in the region has in the past been dependent on traditional sectors such as clothing, textiles and low-end manufacturing. The transition to a high skill, high technology regional economy will take time to achieve. However, for counties Sligo and Leitrim total employment in overseas firms has risen by almost 30% since 1999, from 2,003 to 3,641 persons.

In that context, IDA Ireland has radically changed its policy with a commitment to deliver new greenfield jobs into the Objective One status regions, including the north west. The agency continues to try to secure new investment for Sligo and Leitrim and is committed to playing its part in the development of the region by maintaining the maximum number of existing jobs in overseas industry and by attracting new foreign direct investment to the region. The north west continues to be marketed for new investment. IDA Ireland has relocated its key engineering and consumer products division and part of the international services division, including software, to the region. This work of marketing the region for new investment is ongoing and there have been a number of other developments in the region.

In July 2001 Abbott Laboratories announced that the company planned to establish a major new pharmaceuticals manufacturing facility in Sligo, which will employ 195 people. Construction of the project has been completed and production has commenced. A planned €45 million investment by the company in the expansion of its diagnostics facility at Finisklin and a further €55 million in the development of a new facility in Longford will create 350 jobs in Sligo and 600 jobs in Longford. Construction of both facilities is well under way and recruitment is ongoing. Eaton Corporation, a global $8 billion diversified industrial manufacturer has established a new operation in Manorhamilton and now employs approximately 200 staff. The company has plans to develop the business further in Manorhamilton and has been recruiting over the last 18 months. MBNA, the world's largest independent credit card lender and the leading issuer of endorsed credit cards, has established a new contact centre at Carrick-on-Shannon, County Leitrim. The company invested €32 million in an expansion project in 2002. This investment brought total employment to approximately 1,000 staff and recruitment is ongoing.

To encourage further investment, IDA Ireland has extended its Finisklin business park and the existing park has been upgraded to international standards. In conjunction with local private developers, IDA Ireland has provided three advance office buildings in the park which are being marketed to suitable services-based projects. Planning permission has been obtained for advance technology facilities at Finisklin and these buildings will be constructed by private developers when progress has been made on securing projects for the existing properties.

The agency has also invested significantly in the development of Keenaghan business park in Carrick-on-Shannon and, in conjunction with a property developer, has provided a new 2,400 sq. m. advance technology building on the park, which is being marketed for new investment. In June 2004, Enterprise Ireland approved €750,000 for the institute of technology in Sligo for the development of a design centre of excellence under its applied research enhancement programme. Utilising in-house expertise and recruited design expertise, the centre will carry out applied design research to support Irish industry.

Enterprise Ireland is proactive in increasing the overall level of innovation in the north west. In this regard, linkages to third level colleges are important. Under the enterprise platform programme, the agency partners the institutes of technology in Sligo and Letterkenny by providing funding for eligible participants to attend the programme and develop business ideas. Given the representation of State agencies and the county council on the Sligo County Development Board, it is considered that, should any further co-ordination be necessary, the county development board would be the most appropriate forum to fulfil this function. In the circumstances, the Minister does not propose to establish a task force for the area. I assure the Senator that the State development agencies, under the aegis of the Department, will continue to market County Sligo for investment and will make every effort to secure alternative employment for the staff who are being made redundant.