asked the Minister for Industry, Commerce and Energy the steps he proposes to take in order to counter the serious effect of the British temporary employment subsidy on certain sectors of Irish industry.
Ceisteanna—Questions. Oral Answers. - British Employment Subsidy.
26.
The Government are seriously concerned at the problems being created for Irish manufacturing industry, particularly certain labour intensive sectors, by the continued operation of the British temporary employment subsidy. I have already made known this concern to the appropriate EEC Commissioners.
The question of the compatibility of state aids being provided by each member state is at present under intensive examination in Brussels.
The Minister obviously shares the concern which the Confederation of Irish Industries and others have expressed on this matter. I do not want to be taken as recommending, but has the Minister considered the possibility of our establishing a comparable scheme until such time as the British one expires?
I have considered that possibility but I am not attracted to it, first of all on the grounds that the British scheme is clearly incompatible with the Treaty of Rome in as much as it distorts competition between members. Therefore, I believe the best solution to the problems that were created by the British scheme is the abolition of the British scheme, either voluntarily by the British themselves or compulsorily by the Commission in the co-ordination of state aids for 1978 onwards. Another consideration which would inhibit the introduction of a similar scheme here, however desirable it might appear on the surface, is that the expense factor for us would be a very major one; and if we are to compete with a large and wealthy nation like the British on the same terms, then in the long term we must inevitably put ourselves at a serious disadvantage. The Government have sought to help in regard to these types of industries by their decision to introduce a pay-related form of social welfare contribution. It was our hope that this could be introduced in April, 1978, but I am now advised that, notwithstanding the best efforts of the Minister for Social Welfare to have it introduced at that time, for administrative reasons it is now going to be possible to introduce it before the beginning of April, 1979.
Is the House to take it that the Minister is actively pressing in the Commission and at Community level for the abolition of the British scheme?
As the Commission are pressing me in relation to an Irish scheme I can equally press for another scheme which is at least as compatible.
I appreciate that there are other dimensions in this which are difficult for us, but can the House take it that the Minister is doing everything that can be done at that level to undertake that on the labour intensive sectors?
I have twice drawn the attention of the Commissioners to the difficulties which that creates.