Committee Reports > List of Committees > Joint > 1981 > Committee on State Sponsored Bodies > Report No. 16 - Nitrigin Eireann Teoranta

MIONTUAIRISC NA FIANAISE

(Minutes of Evidence)

Dé Céadaoin, 3 Meán Fómhair, 1980

Wednesday, 3 September, 1980

Members Present:

SENATOR EOIN RYAN IN THE CHAIR

NÍTRIGIN ÉIREANN TEORANTA

Mr. T. O’Brien, National Group Secretary; Mr. T. Duffy, Branch Secretary; Mr. J. Nolan, Mr. J. Byrne, Mr. M. Kennedy and Mr. P. Hayden, Shop Stewards, Irish Transport and General Workers Union; Mr. T. Kelly and Mr. S. Byrne, Shop Stewards, Federated Workers Union of Ireland, appearing on behalf of the Workforce at Arklow Gypsum Limited, called and examined.

245. Chairman.—Mr. O’Brien, would you like to lead off? This meeting is at the request of your deputation so we will let you say whatever you want to say and then we will probably ask some questions.

Mr. O’Brien.—NET decided in 1973 to build a Gypsum Plant on a 10-acre site in Arklow Harbour. The plant was completed in 1975 but due to a number of difficulties caused by factors outside the control of the work force, it did not go into production until 1979. The total cost to NET we understand was approximately £7 million. The total work force was not employed up to present levels until 1979-80.

During this period also, the Company had embarked on the building of Marino Point fertiliser plant. It is obvious therefore that the capital involved in both undertakings was vast. As far as Arklow Gypsum was concerned it was obvious that it would take some time, with reasonable market conditions, for it to become profitable and give a return on the investment. Everybody was confident that this could be done in the long term.

We were informed in early July this year that the plant would close on 31 August 1980 due to continuing losses. Having regard to the fact that the plant only started production in 1979, in its first year it lost slightly over £2 million. The figures given to us at a meeting on 18 July 1980 would indicate that there was a possibility of the plant making money within two to three years. The loss it would appear was being reduced; even based on the 1979 figures we were informed the loss in the first six months of that year was £1,145,000 reducing to £729,000 for the second six months. The projected loss for 1981 would be £978,000. To achieve this of course the turnover would have to be doubled. We were confident that, if the markets could be obtained for the product and if the economic climate changed with the possibility of reducing costs by way of the use of waste gas or natural gas, the undertaking would become a workable proposition.

We are satisfied that if Arklow Gypsum was not part of NET it would have had a better chance to survive. The losses being experienced in NET and the Company’s present financial problems are the main cause of the decision to close down Arklow Gypsum. The loss suffered by Arklow Gypsum taken against the total losses of NET is not very great. From the inception of the plant everybody was aware that it would take some time to get it off the ground and into a healthy trading state. We believe that this would not be achieved until at least 1983. There are a total of 138 jobs, 80 of these are production, the remainder are clerical, supervisory and mechanical.

We wish to draw to the attention of the Committee the fact that no proposals were placed before us for a revamping of the operation or to consider any proposals that would keep the plant in operation. The workers were concerned about rumours that their jobs were not secure early this year and had a meeting with the former Managing Director, Mr. Hynes, in March last arising from which the attached statement was issued to all employees on 1st April 1980. I will hand copies out later. This indicated that the Board had made a decision to operate the plant to at least the end of the year. The employees feel sore about this decision being rescinded without consultation with them and this can have repercussions in the event that the plant finally does close before that date.

Following representations to the Government, a decision has now been taken to run the plant until 30 September unless, in the meantime, some way is found to convince the Board of NET to change their decision. On that point, the officials of NET and Arklow Gypsum informed us that the losses are running at the moment at approximately £130,000 per month.

We look to this Committee to thoroughly investigate the circumstances of the proposed closure and to recommend to the Board of NET that it be retained and an effort be made by all concerned, including the workers, to make the plant viable within two years. We are confident that the plant has not had a proper chance to show what it can do. We feel it is too easy to close a plant with the potential that this one has, but not so easy to start it up again. The workers are prepared to try any avenue that will give a possibility of the plant being retained.

There are two documents attached to the submission which I will hand around. One is a copy of a document posted on the notice board in Arklow Gypsum by the then Chairman, Mr. Hynes. It is dated 1 April 1980. The other document was prepared by the operators in Arklow Gypsum for submission to the Minister for Industry, Commerce and Tourism recently. It gives a few details about how they feel and the facts as they see them.

Chairman.—Does anybody else want to say anything? Would any member of the Committee like to ask any question?

246. Deputy B. Desmond.—We might try to get back to the beginning. NET made a submission to this Committee in January 1980. In that submission they said that after extensive tests, including a full-scale trial on a wallboard plant in Europe, the Company decided to build a plasterboard factory at Arklow harbour and that the product would be destined mainly for the export market. They undertook a feasibility study in the early seventies. Did the Union ever get a copy of it, or was a copy made available to the operatives in the plant?

Mr. O’Brien.—Not that I am aware of.

247. Deputy B. Desmond.—Apart from the substantial increases in the cost of energy in 1973-74, which apparently had a considerable bearing on the economics of the plant, have the Union any idea what went wrong? It seems that the feasibility study indicated that such a plant would be viable, but between 1973 and 1978-79, £3 million or £4 million was lost. In the first three years there was no production at all. In your submission to the Minister you said there were many failures with machines during this time, the main one being pressure testing the autoclave. Since your Union represent the operatives in this plant, could we ask you what went wrong?

Mr. Duffy.—This was during the commissioning period and there was an extraordinarily long commissioning period. There was some dispute when the contract was issued with regard to the machinery which was installed. There was no fault on the part of the operators as far as we are concerned. It was a dispute between the Company and the contractors. It dragged on year after year.

248. Chairman.—Was there a delay in the machinery being effective?

Mr. O’Brien.—That would account for some of it. We must acknowledge that, in the meantime, the cost of fuel went up. The cost of other raw materials went up as well. They were late getting into the market. The economic climate at that time was not as conducive as it would have been if we had gone in at the scheduled time without these problems. I understand one of the major problems was the fact that the contractors failed to get an important spare part. I forget the technical name for it. This held up the commissioning of the plant for a year.

249. Deputy B. Desmond.—We are talking about a period of years. Pre-trading expenditure was incurred to the tune of £2½ million at least. We want to get to the bottom of what precisely happened. Does it strike you as odd that if feasibility studies were carried out including a full-scale trial on a wallboard plant in Europe, such things as the availability of spare parts were not taken into account?

Mr. O’Brien.—I am not competent in that area. I took over in 1977. From what I gather from the information that the workers have given to me and to the branch, the situation was that the German contractors who installed the machinery — I think it was a German contractor — were themselves a bit slow and, to say the least of it, in one case, as I understand it, had to tease out the testing of the machinery themselves. In other words, they were not familiar with it. Some of the people concerned might be able to verify that.

Mr. Duffy.—Yes. That is correct. The contractors themselves were running into something new and there were problems being solved. They were learning from the installation themselves. Could I refer to the report of the Oireachtas Committee with regard to NET? I have a 100-page document here. A page and a half of the document are devoted to industrial relations but even that page and a half seem pretty damming with regard to restrictive practices. They give the impression that there were restrictive practices which led to the situation.

250. Chairman.—To which document is the speaker referring?

Mr. Duffy.—The document issued here by the Oireachtas Committee. It is referred to in the last few pages here. The question has been asked if it is true that workers could come in and get treble time. That is not true.

251. Deputy B. Desmond.—Is that a transcript of evidence?

Mr. Duffy.—It is a transcript of evidence. It also refers to Gypsum in the transcript and we are concerned about this aspect of it. Our people were never asked at any time to cut back on claims or forego National Wage Agreements. If they had, we would have cooperated. We are interested in keeping jobs. If it meant that we had to forego certain phases in National Wage Agreements, we would have done so, but we were never given the opportunity.

252. Deputy B. Desmond.—I wish to put it straight to you that the Company have said that they are losing £130,000 a month. On the other hand, in your submission here you say no later than June of last year that you have achieved 96 per cent of on line production. Given 100 per cent on line production, which is highly unlikely, would the plant be still losing, say, £120,000 per month? Is the plant, in other words, inherently uneconomic? That is a question in which I am particularly interested.

Mr. Duffy.—With that situation, would the Germans or the British be interested? There must be some possibility and we feel that it can be done through Irish people.

253. Deputy B. Desmond.—But do you know anything about that?

Mr. Duffy.—From what I understand, there are two firms interested, Rigips and British Gypsum.

254. Senator Cooney.—Your addendum to the memorandum states that British Gypsum would close the place, and that Rigips have not responded.

Mr. Duffy.—That is correct. They were to come back to us by the end of August. They have not come back yet.

255. Deputy Deasy.—Could I ask a question? Where does the £130,000 a month loss come from? Do you dispute that figure?

Mr. O’Brien.—From the Company. We have no means to dispute it. Unless we got accountants or professionals to examine the books, we must accept what the Company tell us.

256. Senator Cooney.—In your submission you say that you are confident that if the markets could be obtained for the product — could you expand on that? If you are losing £130,000 a month and there is a question mark over employment—

Mr. O’Brien.—They were not long enough in business to be able to develop and solidify their export market, which is the main market which will keep us going, British, continental and world markets. There is not much prospect at home. To get into the home market, one would have to beat the Kingscourt Gypsum Company. This Company are a long number of years in business and have a fairly good product. There is also one other factor which reacts against Arklow Gypsum. This is that they do not make bag plaster. If you buy plaster board, you need bag plaster as well. If you ask for Arklow Gypsum the suppliers will say that they cannot match it. That could be a problem. Kingscourt Gypsum is so long on the market that contractors are used to it and they also supply the other products which go with it.

257. Senator Cooney.—Surely, when this project was being contemplated and the various projections were being made, an essential projection was the market in which it was going to be sold? Presumably there was a satisfactory projection in this regard? Have you any idea what has changed this so that there is the situation which, in your submissions, you acknowledge what seems to be a fact, that the markets are not there?

Mr. O’Brien.—There was a downturn in the construction industry at home and abroad which could account for part of it. This, coupled with the other factors mentioned about increased costs of fuel and raw materials, all combine to probably worsen the position and have brought about the decision to close down earlier, possibly, than the guarantee given by Mr. Hynes in a report of this year.

258. Deputy B. Desmond.—We come back to the situation that a decision was taken in 1973 to build a gypsum plant on a ten-acre site and presumably to invest about £4 million. As we are aware, the crude petroleum energy cost went up in 1974. Yet the plant continued to be developed and was not completed until late 1975. It did not come into production until 1979. Would it not have become apparent, if one examined the economics of gypsum production at that stage, with energy costs well and truly known by the end of 1974, that the project seemed destined to be, on the basis of information already known at that stage, completely and utterly unviable or are you convinced, as an employee with a trade union interest in the job, that it could have been made viable at that point? Were these two years of bad management or good management or what?

Mr. Nolan.—I think I can answer that in some way. Babcock BSH are a German company which built Arklow Gypsum. When they finished it, there was a preparation plant and a board plant. They told the Management that they would help them with the preparation plant and the running of that. They said that they did not know anything at all about the board plant. From 1975 up to 1979, everyone was experimenting. No one had any experience about a board plant. In actual fact, the Rigips Company have been interested and came over in 1978. They looked at the plant and said “You will never make it”. They spent a week over here this year and said “What you have achieved in two years took us 20 years to achieve. Considering that when you started off, no one knew anything about it, you have done really marvellously”. For those five years, everyone was experimenting. The German company which built the plant said they only knew about the first production and knew nothing about making boards.

259. Deputy Kenneally.—Was the advice of any, other company sought or was there any consultant brought from Kingscourt, since they had been making gypsum board for many years? It would have been appropriate to have had somebody from that company.

Mr. S. Byrne.—The answer to that is what we are doing is making synthetic gypsum and our plant is probably the only one in Europe which makes synthetic gypsum. It is a completely different and new ball game. The whole problem is that there is not the expertise. If there are experts, they are not willing to come and help us. That is the whole point. Nobody from Kingscourt is willing to come down and tell us how to make board. The other problem which we faced from 1976 to 1978 concerns the type of gypsum we have been trying to make. Things did not work out as we thought they would but we have now come up with the right solution and developed a type of board which can be made profitably. It has taken three years to perfect it by trial and error and through our own efforts.

260. Senator Cooney.—Is the situation now, that having got the product right, the market has gone?

Mr. S. Byrne.—To a certain extent, yes.

261. Deputy Deasy.—Are you affected in any way by the dumping by Third Countries of the type of product you produce or by over-supply within the EEC?

Mr. O’Brien.—Possibly that could be a factor in the export business but I have not come across any cases of dumping of plasterboard, although it does apply to other products.

262. Deputy Deasy.—What are your marketing difficulties at home and abroad?

Mr. O’Brien.—The biggest problem on the home market is that the Kingscourt company are well established and can supply the home market.

263. Deputy Deasy.—According to the statement you have submitted to us it is your feeling that the Kingscourt company would buy out the Arklow concern simply to close it down. Is that the position?

Mr. O’Brien.—That is the view the workers hold. The Deputy is reading from an addendum which was prepared by the workers themselves for submission to the Minister for Industry, Commerce and Tourism. If the Arklow plant were to be purchased by British Gypsum I doubt if they would keep both plants open.

264. Chairman.—Would they buy it just to put a rival out of business?

Mr. Nolan.—I think this is feared also by the NET management.

265. Deputy Deasy.—I am somewhat confused by the variety of your products. Could you state what is actually produced?

Mr. S. Byrne.—We produce plasterboard and jointing compounds which are used between the boards. Because of the problem with the water ratio our plaster is not suitable for spreading and skimming over and that is one of the problems we have faced. It was thought as a result of studies carried out when the factory was built that it would be suitable, but when the product was produced it was found that it would not go as far as that produced by British Gypsum. Basically we concentrate on plasterboard and related products such as adhesive plaster and jointing compounds. We try to concentrate on system building products for the erection of partitions and so on. We also have a connection in England for the supply of studding.

266. Deputy Deasy.—Would you comment on the reference to Commercial Plywood in your submission?

Mr. S. Byrne.—This is a British company who erect systematic partitions. They also cover our board with vinyl decorations and sell it as a package. They are a big concern in England. Because of the business in which they are engaged the quality of the product must be very high. They have found that the quality of our board is better than that supplied by British Gypsum and they are willing to take one-third of our production.

267. Senator Hillery.—If you have reached that stage of quality and standard in your products, what are the specific marketing difficulties you are encountering?

Mr. S. Byrne.—The Irish market is fairly tight at the moment. We are fighting British Gypsum who will under-cut us to keep us out of the market. There has been a fall-off in sales in Europe. Because of the currency problems it is not as attractive to sell our board in England and our best market is in Ireland where we must face a big combine like British Gypsum.

268. Deputy Deasy.—You make reference to the use of natural gas or waste gas from NET. What hopes have you of getting that?

Mr. O’Brien: It would be cheaper than oil or other conventional fuels. I understand tests were carried out on the possibility of using waste gas from NET’s Arklow plant and piping it to the Gypsum plant. The other possibility is that Arklow might benefit if natural gas from Kinsale were piped up the coast to Dublin. Certainly we could benefit from such a pipeline but I do not think a decision has been made on this matter as yet.

269. Senator Cooney.—Have any studies been made?

Mr. O’Brien.—I do not think so.

270. Senator Cooney.—So we do not know if that would make you competitive with British Gypsum?

Mr. Nolan.—Mr. Hynes talked about the waste gas from the ammonia plant. Driers are used for the board and they use an enormous amount of gas. Mr. Hynes said that NET would be able to sell gas to us at the same price as heavy fuel oil and this would considerably reduce our expenses.

271. Deputy B. Desmond.—Have any studies been done on this matter?

Mr. Nolan.—No. Mr. Hynes said this in March but the plant has now been closed.

272. Deputy B. Desmond.—I have not been to the ten-acre site but surely it must be valuable?

Mr. S. Byrne.—Yes. It is situated beside the harbour.

273. Deputy B. Desmond.—It is a fully developed site with access to port facilities. Have you any idea of the value of the plant?

Mr. S. Byrne.—Perhaps £3 million.

274. Deputy Deasy.—What could be done to put you in a break-even situation?

Mr. Duffy.—We never really got a chance. We got going in 1979 and early in 1980 the rumour went around that the plant was closing. It was very hard to look for orders because of fears that contracts could not be met. There has been a kind of stalemate since last March.

Mr. O’Brien.—All of the unions have been working through Congress since the decision was made to close the plant and the general view is that we had not enough time before the first announced closure date of 31 August. The management did not have the will to do anything at that stage because the Board of NET had made a decision to close. Congress asked for extra time for the purpose of possibly carrying out a study to see what could be done. I do not know whether it could be done by the end of September, but if we had the time we might as a result of such a study, be able to help the management to put the plant on a sound footing.

275. Deputy Deasy.—Have you full confidence in the management and the Board of NET?

Mr. O’Brien.—We have nothing to indicate other than that they are managing in an efficient manner. They have been beset by many factors and we are not condemning them. We do believe, however, that enough was not done to give Arklow Gypsum a chance.

276. Deputy Deasy.—Would you feel happier if your concern were operated by a separate board of directors and separate management?

Mr. O’Brien.—Yes. That is the feeling of the workers.

Mr. Duffy.—We feel that what is happening in Cork is responsible for our people losing their jobs in Arklow Gypsum. The heavy losses incurred in Cork have had a bearing on what is happening with our work. It is only a drop in the bucket. We feel that given a chance, probably with separate management, we could make it work.

277. Deputy Deasy.—Have the Union got any representatives on the Board of Directors?

Mr. Duffy.—In NET but not in Gypsum.

278. Deputy Deasy.—Are the people on the NET Board taking up your battle too?

Mr. O’Brien.—There are four worker directors on the NET Board and the nominated directors. As far as we know they have done everything possible—there is no reason to doubt they have not done it—to try to keep the plant going.

279. Chairman.—At the present time what proportion of normal time are you working?

Mr. Nolan.—Since we got the 96 per cent production in June—we were only on that for a week—we had to shut down because there was a slump in the building trade. We only had a week to prove that we could do the 96 per cent. The Board decided that they would shut Arklow Gypsum so we are not producing at the moment. We have not been producing for the last three weeks. We hope to start up again next week on a different shift system. The only way we have been producing since June has been that when a person put in an order for boards we just made them. It has mostly been for commercial panelling.

280. Chairman.—You are producing a great deal less than your potential?

Mr. Nolan.—We have not been making all we could.

281. Deputy B. Desmond.—Have you gone through your annual holiday period?

Mr. Nolan.—Yes.

282. Chairman.—Deputy Desmond asked a question that even if you were on full production and able to market what you produce would you be making a profit or is there some other basic problem in relation to this? Could you develop that?

Mr. S. Byrne.—I would say yes, but we need to be on a 96 per cent production line. To be quite fair, we had not got that until June. We have never been in a situation when we have been producing 96 per cent of capacity. We cannot give you an answer as to whether we can sell all we produce. We have only got to that stage now. We cannot tell if we would be able to sell the 96 per cent of production.

283. Senator Cooney.—What will this extra month be used for? Are studies being done to see if any changes in operation procedure can be arrived at so that you could become competitive? It seems to me that you would have great difficulty, as you are not competitive. even if the market were buoyant. You will be trying to sell a non-competitive article in a restricted market. This seems to me to be a great difficulty in relation to the future of the plant.

Mr. O’Brien.—We could have discussions with the management of NET and Arklow Gypsum, with the Department of Industry, Commerce and Tourism, the Department of Labour and the IDA. There are one or two things we hope would happen as a result of this. The first is that some way could be found to keep the plant going under present management or secondly that through the IDA and Mergers Ltd. a new owner could be found. If we are not given enough time to study the first option, the only alternative is to go for the second option which we are not opposed to. Our whole concern is to keep the industry going, to keep the jobs in Arklow, and to try to do a job for Ireland as well on the export market. We would want a longer time to carry out studies for the first option. If the Board’s decision of March last was carried out—that we would be given to the end of the year—that would give us a fair chance to do something. The other alternative might help. We do not know what the latest information is. We have not got direct information from management. The possibility is that we may reach a stage before the end of this month when a new owner will be brought in. The ssibility, we are told by the Company, is that the new owner will be a German/Swiss consortium.

284. Deputy B. Desmond.—You referred in passing to the National Understanding Could you elaborate on that?

Mr. Duffy.—We have never got a chance. Our interest is in maintaining jobs. If the Company had called us earlier and said that they were in a loss-making situation and they did not think they could meet the National Wage Agreement we would have discussed that. By and large, the jobs are pretty good and if it meant foregoing the National Understanding in favour of jobs I am sure we would have got 100 per cent co-operation. The matter was never put to the lads. When money is due from the National Wage Agreement it is paid, but the bombshell has been dropped. We should have been called in and consulted. There are 138 people there and we would prefer to see jobs for 100 people rather than no jobs for 138 people. We would be prepared to talk along those lines but we were not given any opportunity.

285. Deputy B. Desmond.—What sort of shift system have you?

Mr. Duffy.—We have a four-shift system, four on and four off, but it is three shifts at the present time.

Mr. Nolan: We have changed to a three-shift system by which we will all lose some money. This will be more economic for the Company, there will be less loss. We have been asked to forego on this and there was no argument about it. If this had been done earlier perhaps things would have worked out better. We are not complaining about this.

286. Senator Cooney.—Will many of the 138 people be absorbed in other activities of the group? Have there been any discussions on those lines?

Mr. O’Brien.—We were told that only nine people would be held back for a month and about three or four management staff would go to NET.

287. Senator Cooney.—Were the 138 men already within the group and transferred to this operation?

Mr. O’Brien.—They went direct into Arklow Gypsum.

Mr. Duffy.—Some people gave up jobs in other areas and came into this Company.

Mr. O’Brien.—They are not regarded as NET staff. They are on a separate pension scheme and conditions are slightly different.

Mr. Duffy.—The Senator referred to the possibility of getting jobs in NET but it is quite obvious from Mr. Conlon’s report that there is no question of jobs with NET. There is a question of the two NET plants being in doubt at the moment.

288. Senator Hillery.—What are the prospects for employment in the ordinary way, other than in NET?

Mr. Nolan.—The main jobs are in NET and Arklow Pottery. I am sure the Committee are very familiar with the situation there at the present time. It is rather shaky.

289. Deputy Deasy.—Has any consideration been given to the possibility of diversification? Do you think this is a possibility?

Mr. O’Brien.—No. It has not been mentioned or discussed. The only possible diversification would be bringing in a new owner, a new product or a new type of operation altogether, and there would have to be a long closedown.

290. Deputy B. Desmond.—Have the Union had any opportunity of meeting the IDA? After all the IDA has £400,000 involved.

Mr. O’Brien.—The IDA officials were present at the meetings we had with the Minister for Industry, Commerce and Tourism.

291. Senator Cooney.—I am not sure what the money is being used for. Is it being used to try to get a purchaser or to study ways and means of trying to improve the situation?

Mr. O’Brien.—We hope that will be the end product. We asked for a time extension to try to find ways and means through discussion with all the interested parties to see if the Company can be saved. Congress are dealing with that end of it.

292. Chairman.—Are discussions taking place?

Mr. O’Brien.—We only started last Thursday morning.

293. Senator Hillery.—Have there been any negotiations on redundancies to date?

Mr. O’Brien.—We have only started talking and we have not concluded those talks.

294. Deputy B. Desmond.—You are on the record here and you said in your submission: “Then came a big change in management in the last two years”. Can you elaborate on that? Were management prior to that good, bad or indifferent?

Mr. S. Byrne.—We had more rows with the previous management than we have had with this management. We find them much easier to deal with.

295. Deputy B. Desmond.—Were major industrial relations the problems?

Mr. Duffy.—At that time they were, but not since the new management took over.

296. Deputy B. Desmond.—What sort of disputes were they? Were they costly?

Mr. Duffy.—Restrictive practices were introduced. Certain provisions were imposed on the lads, one of which was indirect overtime, where people had to be available, where they were on call but were not paid for that. The situation was that people who were supposed to be off were often called in because of undermanning at the plant. Eventually we got new management whom we found to be much more co-operative.

297. Senator Cooney.—Was there any suggestion that that earlier climate of disagreement contributed to the delay in commissioning the plant.

Mr. Duffy.—No. That was purely secondary.

298. Deputy B. Desmond.—Was that in 1977/78?

Mr. Duffy.—Yes, but management were having problems also, at the plant.

299. Deputy B. Desmond.—Would you say that poor management was the reason for this?

Mr. Duffy.—No.

Mr. Nolan.—In the five years that we have been there we have never had a strike nor even a dispute. Everything was indirect overtime all the time. We were paid two hours overtime every week but the situation was that those on their days off could be called in. In other words, somebody on his four days off could be called in for those four days but would not get any extra money. When new management took over they realised that this was happening. What was involved was not a dispute as such. The problem was that when a fellow would be called in, he would be found not to be available with the result that it was no longer possible to bring in people who were on their days off. The new management introduced an overtime system which worked a lot better.

300. Deputy Kenneally.—On the question of waste gas from the ammonia plant, is this surplus gas or what?

Mr. Nolan.—Mr. Hynes did not elaborate on that. The gas that we would have been getting was for the entire NET operation, including the ammonia plant and we thought that when the ammonia plant went, the gas that would have been used for that would have been sent to us.

301. Deputy Kenneally.—What type of sales structure do you have? Are there men in the field or is this operation carried out by way of agencies?

Mr. S. Byrne.—The Company has its own sales staff. It has a representative for each province in the country as well as having European contacts. This aspect of the operation is only being built up. As production increases, sales staff are called on. Sales staff have just been put into the Northern Ireland market.

302. Deputy B. Desmond.—Were all of the staff that were taken on in the 1973/78 period new, in the sense that none were employed previously by NET?

Mr. O’Brien.—Many of them moved into Arklow from other areas. Some of these were Arklow people who had been working away from home and quite a number of them were from the peripheral areas, some from as far away as Rathnew.

303. Deputy B. Desmond.—Is the labour force a relatively young force?

Mr. O’Brien.—Yes.

Mr. S. Byrne.—Even during the past six months workers have left permanent employment to join our Company but they now find that they will be out of a job.

Mr. Duffy.—One man who had seventeen years’ service in another job left to join our Company because he thought there was a future in it for him. He will have lost his seniority and his service from that other employment.

304. Deputy Deasy.—I am inhibited somewhat by your lack of expert advice in the whole matter. Most of you are depending on what you are being told by the Management. However, can you give us an indication of what is the total demand for your product in this country and what proportion of that demand is being provided by British Gypsum at Kingscourt?

Mr. S. Byrne.—Our workers are not involved in sales. We are in the production end so that in effect we can only be guided by hearsay. We can only say what we consider the situation would be. We do know that we have affected British Gypsum because they had the market before us and we have bored into the Irish market.

305. Deputy Deasy.—It may be that British Gypsum have sufficient capacity to supply the country’s needs so that if you do not succeed in obtaining a good export market you are doomed. What are your views on this?

Mr. J. Byrne.—I think that is the view because even British Gypsum say that the market cannot afford two plants.

Mr. O’Brien.—The market cannot afford two plants. We would need to build up a strong export market in order to render our plant viable or even to get someone to buy it.

Deputy Deasy.—That would be difficult at a time of recession.

306. Deputy B. Desmond.—When you sell commercial plywood to the UK, do you sell to a number of suppliers or to just one?

Mr. S. Byrne.—Just to the one and he acts as a wholesaler.

307. Deputy B. Desmond.—Would that company have any interest in a takeover?

Mr. S. Byrne.—I do not expect that they have been approached about any such possibility but in any case they are in a different area of operation. They do not have the expertise in the manufacture of plasterboard but the company who are interested in such a step have been in the business for 35 years.

308. Deputy Deasy.—Have you any idea of the output of the product in the other EEC countries or of the demand?

Mr. Duffy.—We do not have any such figures.

Mr. O’Brien.—We shall endeavour to get them for the Committee.

Mr. Duffy.—This is something entirely new We have made inroads now in a way that has not happened at work before. In my opinion it is premature to talk of closing down at this stage.

Mr. O’Brien.—The idea of a plasterboard plant at Arklow based on raw material from NET was a good and workable idea despite the problems that arose. I still believe that if we could come through the present recession there would be a place for this plant, mainly in the export market.

309. Deputy B. Desmond.—Would you be critical of the failure to follow through a feasibility study of the technological capability of the senior mechanical, engineering and technical staffs involved at that time when it seemed to have taken an inordinate length of time to bring a plant into commission? One would have thought that a plant of that nature would have been brought into commission within 18 months to two years at most.

Mr. Duffy.—In fairness I expect that NET believed that the Germans had the expertise to do the job whereas when the Germans concerned came over to the plant they found that they themselves were learning.

310. Deputy B. Desmond.—When one enters into contracts with consultants and when £2 million to £3 million of taxpayers’ money is being spent one is supposed to know what one is doing. Do you not agree?

Mr. Nolan.—Perhaps people should have been brought from some plant elsewhere in the world, people who would have known all about the operation.

Mr. Kennedy.—Part of the original plant was taken back to Germany this week.

The witnesses withdrew.