The closure of the Mallow sugar beet factory in Co Cork with the loss of 320 full- and part-time jobs and the end of a 155-year-old industry yesterday signalled the beginning of a scramble for EU compensation.
Greencore, which has owned Irish Sugar since it was privatised in the early 1990s, said the last remaining sugar processing plant in the State would close in May and would not be processing sugar in this or any subsequent year.
"The decision of the EU Council of Ministers on November 24th, 2005, effectively spelled the end of sugar beet-growing and processing in Ireland," said its statement.
However, it said that its board had taken independent legal, economic and financial advice and had determined that the group was entitled to 90 per cent, or €131 million, of the EU restructuring compensation, with the remaining €15 million being reserved for growers and machinery manufacturers.
The Irish Farmers' Association, which represents most of the 3,700 growers, reacted angrily to news of the closure, which will have a significant economic impact on Mallow and the surrounding region - the IFA had been negotiating the possibility of one more year's production up until late last week.
Its president, Pádraig Walshe, who last month said farmers were entitled to €106 million of the €146 million exit compensation, said much of the blame for the demise of the industry rested with Greencore.
The leader of the IFA growers' group, Peadar Jordan, said the Minister for Agriculture must not give Greencore a cent in compensation. He said it would be a travesty to pay EU money to a company that had squandered millions earned off the backs of farmers in bad investments.
However, the Minister for Agriculture and Food, Mary Coughlan, who expressed regret at the closure, said she would be seeking independent advice on the drawing down of compensation.
She said the total EU funding available in terms of compensation was €310 million in single payments, restructuring aid and diversification funds.
"The procedure stipulated in the reform regulations for drawing down these funds will now have to be followed," she said in a statement.
"In this context the company will be required to submit an application for restructuring aid including a restructuring plan to cover the economic, social and environmental aspects of the factory closure," she said. The Minister said she would be taking submissions from all the parties involved and "a fair and transparent" decision would be taken after July.
Siptu, the union representing most of the workers at the plant, said it would be seeking the maximum possible redundancy package and a substantial share of the €146 million compensation package to be provided to the workers whose jobs will be lost as a result of the closure.
Greencore's decision was a catastrophe, said Siptu's national industrial secretary, Gerry McCormack. He accused the Government of pandering to the farming lobby's demand for compensation at the expense of the workers. Siptu would "not stand idly by while Greencore and the beet farmers seek to pick the flesh bare on the corpse of the Irish sugar industry", he said.
He said farmers would continue to be paid subsidies and could grow alternative crops and would also receive compensation, while the sugar plant workers would be left with no jobs, little or no prospects of finding alternative work, and would have to rely on redundancy payments for their future.