SEANAD IN COMMITTEE. - HOUSING (BUILDING FACILITIES) BILL, 1924.—REPORT STAGE. – Seanad Éireann (1922 Seanad) – Thursday, 3 Apr 1924

SEANAD IN COMMITTEE. - HOUSING (BUILDING FACILITIES) BILL, 1924.—REPORT STAGE.

SECTION 9.

Mr. JAMESON

I move the following amendment:—

Section 9. To add at the end of this section the following words:—"Provided that this section shall only apply to the purchase or manufacture, storage, transport, and sale of materials or appliances to be used in an area in which the Minister, after a local enquiry under Section 8 of this Act, is satisfied that the cost of any materials or appliances in that area is excessive and restrictive of the output of building work."

I introduced this amendment with the idea of restricting the trading activities of the Government to areas where they found prices were wrong or where contracts were so expensive as to stop the work. If they institute such an inquiry they can use the powers they are taking under Section 9, if necessary. As far as the discussion on this subject went on the last occasion in the Seanad, it was evident from the vote that was taken that the majority of the Senators were in favour of the Government entering into trading operations on a Bill that is to last only for 12 months. The Government was to have power to establish factories and purchase quantities of material. As well as I could, I pointed out that these trading ventures could be entered into without getting the consent of the Oireachtas. The President stated that every expenditure would have to be sanctioned by the Oireachtas, but the wording of the Bill, as far as one can judge, provides for the expenditure first and for sanction afterwards. There is nothing to show that that is not the practice that is going to be followed.

I do not think I ever knew of a Bill, especially a temporary Bill, giving sanction beforehand for what might be a disastrous course of trading, and interfering perhaps with the perfectly legal profits of persons that this Bill wants to induce to come back to business—speculative builders. These restrictions are evidently aimed at speculative builders who may happen to build houses and sell them at a profit. I should think that it would have paid the State to have some body of men connected with housing to deal with the matter, so as to induce people to speculate in house building, and put their money and labour into it. Instead of that this Bill insinuates that everybody connected with the supply of material for builders and with contracts is trying to rob the State. The amendment seeks to restrict trading activities to areas where the cost of materials or appliances is proved to be excessive, so that the powers taken shall not be used all over the country.

Mr. HAUGHTON

I beg to second the amendment, Judging by the reports, this matter was dealt with very fully on a previous occasion in the Seanad. As one connected with the trade in the South of Ireland, I can assure the Seanad, whether the majority will agree with me or not, that in the trade connected with the supply of building material at the present time, there is a great deal of competition. In the City of Dublin, which has been criticised so much, I venture to say that no trade has experienced such keen competition as the timber trade and building materials generally. As far as I can see, no evidence was adduced on a former occasion of any profiteering in that branch of industry. As Senator Jameson has remarked, I do not think any member of the Seanad knows of a suggestion such as is contained in this section being made in this or any other country. I have also tabled an amendment to Section 8.

AN CATHAOIRLEACH

I should have called that first. I will come back to it. It is not an essential part of this amendment, and it was handed in after the printing of the Orders of the Day. If you wish to refer to it now in connection with this amendment, there is no objection to your doing so.

Mr. HAUGHTON

It would be singularly unfair to a builder or contractor who entered into a contract for supplying materials that, after the materials had been supplied, at what was mutually agreed was a fair price, a tribunal should step in subsequently and say, "We find you could have got the materials at a lower price."

Mr. FARREN

We heard amendments of this sort discussed on the Committee Stage. The object of the Bill is to protect builders and not to allow any restrictions. Senaton Jameson states that we should allow the building to start. The Bill does not propose to interfere with builders. If a man comes along and builds a house and gets a subsidy of £100 from the State and £100 from the Local Authority, the only restriction is that he shall conform to the regulations laid down by the Local Government Department and its engineers, and that the house should be of a certain capacity. The object of this particular section is to see that the builder is not hampered and to prevent excessive prices being charged for materials. Senator Jameson's amendment is to the effect that the section should only apply to an area where it has been proved to the satisfaction of the Minister that there has been profiteering.

It is a notorious fact, notwithstanding the statement of Senator Haughton about there being tremendous competition amongst builders' providers, that if you ask for quotations for building materials you will invariably get the same figure from all firms. If there is such desperate competition in the trade as Senator Haughton would lead us to believe, how do you account for the fact that very seldom is there the slightest difference in quotations from these firms who are in such desperate competition with one another? That fact is sufficient argument why the Government should have some regulation to empower them to protect builders who propose to build houses under this Bill, from being fleeced by people who provide them with the necessary materials. I do not anticipate that the Government will build factories to provide these materials, but they provide a section in this Bill that will prevent people who want to profiteer and take advantage of the terrible necessity that exists for houses. These people will charge excessive prices to the builders who, we hope, will build houses, and it is to prevent excessive prices being charged that the section is included. I, therefore, oppose the amendment.

Mr. JAMESON

Senator Farren deals with facts, and I am only reasoning. He says that there are no quotations to be got at present except one from the providers of building materials.

Mr. FARREN

I said that invariably you get the same quotations from all the builders' providers for standard articles.

Mr. JAMESON

I think that is your statement, and the remedy the Government is going to supply to that is to enable the builder to be certain that he will be able to get competitive quotations, and that the Government are going to deal in all these things and give them to the builders at a five per cent profit on what it cost them. I was looking through the Bill to find out how they are going to get rid of the materials which they purchase, and to complete the Bill they require a clause to compel the contractors to buy those things from the Government. Otherwise, there is no vestige of doubt that when the Government have materials ready to offer to builders, if their prices are not as good as the builder can get elsewhere, the Government will undoubtedly be left with material on hands so far as this Bill is concerned.

There is one thing we learned in the Great War and that was, that wherever the Government came along to meddle with trade or to get things made, or to take over business and produce the stuff themselves, it cost the nation an infinite amount of money more than if they left it to people who knew their business and who carried on the trade themselves. I had a great deal to say to that, as I was on the other side of the water watching contracts, and wherever the Government came in and took things out of private hands in any trade or business, the nation paid a huge sum for it. Probably the Senator is right; the Government may not use this power, but it is an awfully bad precedent to put in a Bill, that such powers should be given to the Government especially in a temporary measure. We ought not forget the lesson of the war so soon as this. This small Free State should not give power to the Government, whether they use it or not, to interfere with the ordinary channels of trade, for if they do, they will probably lose more than the £300,000 grant provided in the Bill.

Dr. YEATS

May I say that Pepys in his diary says: "It is a singular fact that His Majesty can never get anything done as cheaply as can private citizens."

Mr. FARREN

With all respect to Senator Jameson, I do not think that he understands the position. When we talk about builders' providers we speak of handlers and not manufacturers. Practically the only thing manufactured in this country which will be used in this type of house is the brick, so when we talk about builders' providers we are speaking not of manufacturers, but of people who only handle the material. These things are all imported, and are generally a standard article. In order to protect the people who will come forward under the provisions of this Bill to build houses it is essential that the builders' providers, who handle the materials, shall not be entitled to charge what they like. As I understand the clause, it is to protect these builders against the providers charging exorbitant prices.

Mr. GUINNESS

Might we have an explanation from the Minister before we decide on this matter?

MINISTER for LOCAL GOVERNMENT (Mr. Burke)

The Seanad have gone very fully into this amendment, and most of us will agree with Senator Farren that the object of the section is not to hinder but to help the builders. I hope it will not be necessary to put the section into operation, but if it has to be put into operation, I think we should take powers to utilise it on sound business lines. I think Senator Jameson will agree with that. I think it is obvious that if the Minister's power is restricted under this section to particular areas, it will be impossible to work the section economically, and it would practically mean deleting the section altogether. For that reason I cannot accept the amendment.

Sir THOMAS ESMONDE

It is hard to make up one's mind on this amendment. What Senator Jameson said in relation to a Government going into business, I am in absolute agreement with. So far as we know anything about Government interference, it has always been disastrous. In these countries, at all events, it has always meant a charge on the taxpayer, but, on the other hand, it seems to me that this clause is more or less in the nature of a preventative to profiteering. It seems to me that this clause is directed against purveyors of building materials endeavouring to charge an improper price. For instance, it would deal with an individual trying to make a corner in slates or imported timber, or other requisite building materials. I am against profiteering in every shape, and, on the other hand, I am against Government interference in business of every shape, but, on the whole, I think Senator Farren has convinced me that this is a question of preventing profiteering, and in a Bill which is only going to last twelve months, the Government will probably not be tempted to enter on large commercial operations. I shall therefore vote against the amendment.

Amendment put and, on a show of hands, declared lost, 9 voting for and 17 against it.

Mr. HAUGHTON

I beg to move my amendment, which reads, "Provided that this section shall not apply to the price of any material which is the subject of a contract entered into before the date of the local inquiry." Contracts, I have ventured to submit, are solemn things to enter into. A contract is an agreement between two parties. If both parties agree to a sum, and subsequently the Minister comes along, maybe months afterwards, and suggests that the price is a little too high and breaks the agreement to the loss of the firm, I submit it would be a gross, a grievous and a moral wrong. There is one political illustration that comes to me as I speak, and that is the case of one of the States of the Australian Commonwealth, Queensland. Many years ago they entered into an arrangement with settlers. Leases were signed at a certain figure, and as years passed by, a Government came into power that altered these leases. The result was that the State of Queensland did not command that respect that it did in previous years.

AN CATHAOIRLEACH

This is based on the hypothesis that Section 8 is retrospective. I cannot find that in the section. You are assuming a contract made before the inquiry. As I read the section it seems to me only to provide that an inquiry is to be held as to the cost of any materials or appliances used in the building of houses. If the Minister is satisfied those charges are excessive, he may prescribe a new scale. It seems to me on reading that section that that would not entitle the Minister to make a scale of charges that would have a retrospective effect on contracts previously made. If that is the intention, it could be more clearly expressed.

Mr. BURKE

That is the intention. There is no intention to make the Bill retrospective.

AN CATHAOIRLEACH

If that is so, I think it would be no harm to make it plain by the insertion of your amendment. That would take it out of the region of speculation. It is only my suggestion, looking at the clause in a cursory way, that it is not retrospective. It might afterwards be decided by the courts that it would be retrospective.

I agree to that.

Amendment, as amended, put and agreed to.

Mr. BROWN

Before we pass from this Bill, perhaps the House would permit me to mention a matter. When the Bill was in Committee there were two amendments in the name of Senator Sir John Keane, and their objects were to extend the benefit of this Act in particular to members of the Civil Service. Senator Sir J. Keane is not here. The first was an amendment to Section 3, increasing the number of square feet that the house may contain, and the Government permitted an increase in the case of houses built by Civil Servants to 1,500 square feet. The second was an amendment to insert after Section 10 a new section, the object of which was to enable a Civil Servant who probably would not be very rich in this world's goods to borrow money on the security of his salary or pension, and also to enable the Minister for Finance to make regulations under which moneys might be paid to the lender from the salary or pension of the Civil Servant by an arrangement. That amendment was withdrawn, by leave, on an undertaking by the President to look into the matter before the Report Stage, and he said that so long as the Minister for Finance was not called on to provide money, he had no objection in allowing it to go through. In the absence of Senator Sir J. Keane, might I ask the Minister whether that has been done?

Mr. BURKE

We looked into this matter, and we find it is impossible to legislate on the assumption that a Civil Servant has a right to future salary, as his appointment may be terminated at any moment. We can arrange to have a portion of the Civil Servant's salary deducted monthly. Perhaps that would meet the case.

Mr. BROWN

What is necessary, if you are willing to do that, is to remove the present legal bar on charging a salary of this kind. A Civil Servant, as the law stands at present, is not entitled to charge his salary or pension; so you would require an amendment giving him power to do that. That is what is meant by the first portions of the amendment:—

"Where any moneys are borrowed by a person who is permanently employed in the Civil Service of Saorstát Eireann, in this section called ‘the borrower,' for the purpose of erecting a house for his own use and occupation in which this Act applies:—

(i) Such moneys (in addition to any other security) be validly charged by the borrower on his future salary and emoluments in respect of such employment and upon the allowance of gratuity (if any) to which he may at any time become entitled in respect of superannuation or compensation for loss of office."