Imperial Tobacco won't be given financial incentives to stay says minister
The government will not be granting financial aid to Imperial Tobacco to keep its Mullingar factory open because tobacco products are "lethal", the Minister for Jobs, Enterprise and Innovation has said.
Speaking yesterday during a Dail debate on the government's response to last Thursday's announcement that the Imperial Tobacco facility on the Dublin Road will close in October with the loss of 87 jobs, Minister Mitchell-O'Connor said that the government is “not in a position to grant financial aid to the company involved”.
“The World Health Organization has a set of guidelines which state that because tobacco products are lethal, businesses producing them should not be granted incentives to run their operations. The circumstances here are unique to this sector and are not necessarily caused by any enterprise policy failure.
“It is an outcome of tougher regulations from our health sector to help protect our citizens' health. For this reason, Enterprise Ireland is not in a position to support the company concerned.”
Deputy Penrose, who along with Deputy Robert Troy, submitted questions on the issue at last Wednesday's Dail sitting, said that a task force has to be established for Mullingar as the town has been “bypassed on too many occasions”.
Voicing his support for SIPTU's attempt to save as many jobs as possible, Deputy Penrose also questioned if Imperial Tobacco were using the recent introduction of a minimum 30g pack size for rolling tobacco as a “ploy” to shut its Mullingar factory.
“Why did the company not take steps to modify the machinery and equipment - much of which was set up for producing cigarette packs and rolls below 30g - and adapt it to deal with the minimum pack size of 30g? The company had three years to adjust and invest. Why did it not do that?
“I researched the closure of the Imperial production plants and distribution hubs in Nottingham and Nantes. They are now moving to Germany and Poland, which are in the EU so the tobacco directive applies there. I have to question this. I note from the statement by the company announcing the closure of its Mullingar plant that its remaining production from Mullingar will transfer to another of its manufacturing sites in the Netherlands. The latter is not in Asia or the USA but right in the heart of Europe. It is relevant to ask whether the company is using the increased EU regulations as a cover or a ploy to shut this factory? It is a question that affects the staff and they deserve to have it answered.”
Government was warned - Troy
Deputy Troy said that while it's possible that Imperial Tobacco are using the changes in regulation to move to regions where the labour costs are lower, the government had been warned in 2013 that the closure was possible.
“What strategy was put in place by the previous Government in 2013 to ensure that when the inevitable happened, there would be something in place for the 87 people who will lose their jobs at the end of this year? The former Minister for Children and Youth Affairs, Senator James Reilly, the Minister for Finance, Deputy Noonan, and the previous Minister for Jobs, Enterprise and Innovation, Deputy Bruton, were written to in 2013 but no action was taken.
“We have an issue there which needs to be addressed. We need a specifically designated task force to come in and work in our region to ensure that we have job creation in future.”