On the previous evening that I was speaking on this Bill the adjournment had to be moved at a most interesting stage. I was on the question as to whether the actual terms and the precise details of the Agreement had been revealed to the Dáil. Speaking that night, I made the statement that:

"The bond was given under duress certainly, but we are not breaking our bond in turning down this, because the proposed method of repayment was not divulged to the House in December last."

I emphasised that the President, a few minutes afterwards, interjected by by saying:

"May I correct a statement of the Deputy's when he said that the House was not led to believe that this was part of the bargain? I made the statement that it was £250,000 a year for 60 years."

Not having the precise details before me at the time, I was inclined to accept this. It is true—and I want to make this public—the House was aware that the agreement laid down a repayment of £250,000 yearly for 60 years. Did it come from the Government or is it something we learn from the newspapers, something that was disclosed in the British House of Commons? The Government, it appears, were inclined to take credit to themselves for giving this information to the public. No thanks whatever is due to the Government. This information came to the House absolutely independent of the Government, and in my opinion were it not for the fact that the revelation had been made in the British House of Commons we would be kept in the dark, in complete and absolute ignorance, as to the secret arrangements which they had made. Mr. Churchill, speaking on the 8th December, 1925, said:

"When the Irish representatives proposed that they should assume for themselves the burden of the compensation charges we have had to pay for pre-Truce damage amounting to approximately £5,000,000, of which £4,000,000 has already been disbursed by us, and that in addition they would issue 10 per cent. more stock to the victims of post-Truce damage, we thought it perfectly right on our part to agree to the complete abrogation of Article 5.... But under the existing arrangement we were liable to pay to the Irish Free State a sum of approximately £900,000 in the next two years. These payments we shall, of course, withhold, and they will form the first instalments of the annuities which they are prepared to pay, and also have the effect, as long as they last, of a moratorium so far as the Free State is concerned.”

Mr. Baldwin, on the second reading of the Irish Agreement Bill, stated:

"The Free State has now undertaken to bear full liability for compensation for material damage done in the Free State area since January, 1919, and to repay to the British Government the amount which this Government has paid or is still liable to pay under the previous agreements. Those amounts are calculated at something over £5,000,000 and the representatives of the Irish Free State offer to discharge that obligation by an immediate payment of £150,000 and an annuity of £250,000 a year for 60 years from the 1st April next. That offer has been accepted by the British Government. The initial payments due from the F. S. Government under this agreement will be set off against payments amounting to approximately £900,000 which would have been made to the Free State Government by the British Government under the existing agreement."

I criticised, on the previous occasion, the rate of interest the Government is paying on this debt. I drew a parallel as to what was paid by France and what England was paying. The French agreement, I may point out, was agreed to prior to the Treaty of December, 1925, and the Italian debt was settled some time about the 25th or the 28th January. The French, under the agreement, are paying 12½ millions annually only for 62 years, or, in other words, their total payments amount to £775,000,000. But what was the French debt to Great Britain? The present amount of it is £620,224,200. In other words, the French are paying a sum of about £155,000,000 in interest on their debt in the course of 62 years on a capital sum of £620,000,000. I will quote the figure the Italian Government is paying from the "Irish Times" of 28th January last:—"What Italy will pay —£277,000,000. Britain to forego half her debt. Statement of terms. The terms of settlement of the Italian War debt with Great Britain were announced last night, and Mr. Churchill said they would be received with criticism both in Italy and in England. The total Italian liabilities is £6,110,840." The total of their payments is £277,000,000. They are evidently not paying interest at 4½ per cent. That fact is obvious even to the densest. Let us see the rates they are paying:— In the current financial year £2,000,000. In the next two years £4,000,000 a year, and in the next four financial years £4,250,000 a year. Each succeeding financial year until 1986-1987 £4,500,000 a year, and in the year 1987-88, £2,500,000. The Government can say that it is easy to be wise after the event and that they were not in a position to tell what the Italian Government would pay, but is that a sufficient answer as to why we should pay the inflated Bill they have now sent us? I am not going back by one penny on the terms of the London Agreement, but I am not prepared to accept anything not within the strict letter of my bargain. We agreed to it in the Dáil, and I was one of those who voted for it. I made my defence at the time and I am not going to repeat it. We agreed to return the sums that had been paid, but the agreement stated—I shall read the words again:—

"The Irish Free State hereby assumes all liability undertaken by the British Government in respect of malicious damage done since the twenty-first day of January, nineteen hundred and nineteen, to property in the area now under the jurisdiction of the Parliament and Government of the Irish Free State, and the Government of the Irish Free State shall repay to the British Government at such time or times and in such manner as may be agreed upon moneys already paid by the British Government in respect of such damage or liable to be so paid under obligations already incurred."

I direct special attention to the words "and the Government of the Irish Free State shall repay to the British Government at such time or times and in such manner as may be agreed upon." Are we to understand from the sane reading of that agreement that, at the date the London Agreement was signed, they had not yet completed the details or worked out the proposals to pay this £250,000 a year for sixty years? It means, then, if they had not done so that while the very fate of the pact hung in the balance the Executive Council agreed to pay £250,000 a year and resolved to keep it secret from the Dáil, and would have kept it secret, I contend, were it not that the British disclosed it to defend the bargain they had entered into. The Government can take no credit whatever to itself, I submit, for giving the actual details of this agreement to the Dáil. The Dáil learned it from independent sources. Mr. Baldwin's statement that I have just read stated that the British had paid over £4,000,000 and had retained £900,000. We are actually paying 4½ per cent., with a ¼ per cent. added to make up the sinking fund, and if an annuity of £250,000 a year is payable it means that the capital charge is just about £5,300,000. I am only giving an approximation.

We cannot discuss the London Agreement on the Second Reading of this Bill, except in so far as it refers to compensation for property losses.

Might I draw your attention to the fact that Section 6 of the Damage to Property Act makes specific terms for the repayment out of the Central Fund of these sums? I ask: Why should the sum we are paying under this agreement, seeing that we have accepted liability, bear any interest at all? I claim that the money came to us as our legitimate right and that in making the refund we are not admitting the right of the other side to receive the money, that it is a gift from us, a gift which certainly I am not objecting to, but which has no right whatsoever to bear interest. We know that this payment will mean £15,000,000 in 60 years. Therefore, if this thing is a gift, if the British, in the actual handing over of the money, admitted our legal right to receive it, that it was a debt justly due to us by the consequences of their own policy, why should we pay any interest on it? Evidently £10,000,000 is going in interest on it and our Government is voting that sum away. So that we have two points, the first being that there should be no interest on it, and the second that when the Government abandoned that policy they ignored the settlement of other international debts and agreed to interest at a very high rate, ignoring what France had paid, and obviously indifferent to the negotiations then prevailing between the English and the Italian Governments, and quite oblivious as to the policy of Great Britain in regard to international debts. As I said before, the Italians got value for their money; we got ruins. The Italians have obtained a very large accession of territory, but we lost a province through the bargain.

What bargain?

The London Agreement. We definitely ceded over the Six Counties.

The London Agreement?

Yes, undoubtedly. There is no mistake about it whatsoever. The Minister for Finance can laugh at inopportune moments——

Why did you vote for it then?

To save the country.

You saved it by giving it away.

He saved the bit that was left.

Yes, for the people resident in the bit that was left. That is an understandable thing. It may not have been an heroic gesture, I am quite prepared to admit. The Minister objected to my introducing the fact that this £250,000 a year in respect of a national loss should be dealt with from the point of view of compound interest. He was inclined to make merry over it. We have got a good historical parallel. The Italian Government, no matter how we may look at them, have a man like Mussolini ——

A man after your own heart.

A good deal after my own heart. In Mussolini they have not the fag-end of Sinn Féin, as we have in that heptarchy, the Executive Council. They raised the question of sums that were left by Florence to Edward III. in his war against Philip of Valois, more than 600 years ago. Evidently, they must have succeeded. Why was the British Press annoyed by the claim of the Italian Government? The Italian Government put forward the claim that these sums, which were lent to Edward III., should be brought in.

What have we to do with Edward III.?

It is a parallel case for the Minister for Finance.

I do not know whether you want Italians over here or not.

We had the Duke of Plaza Toro here last night.

I would be glad to be permitted to proceed. The Minister can only laugh at the expenditure of Irish money in that way. He evidently is not a financier or a political economist. We were taunted with being economists last night. We have occasion to be economists, although we are only plain farmers. We are told that the total amount of the capital sum of the debt is something like £5,000,000, and the British have retained £900,000 of that. Our Government did not take into their calculations this sum that the British already hold, which should not enter at all into the basis of calculation. So that the capital sum is only just over £4,000,000. They propose to repay that sum by annuities of £250,000 for fifty-seven years, and that is what they are asking us to endorse. As a matter of fact, a payment of £250,000 a year, with a charge for sinking fund, represents considerably more than 4¾ per cent. It is 5¼ per cent., approximately. Can the Minister say what is the meaning of including this sum of £900,000, which the British owed to us, which we left them, and which automatically clears the ledger to that extent? Why should it be utilised in computing the sinking fund? We are paying this £900,000 twice, and we are paying interest on it at 4½ per cent. for sixty years. That is what it really works out at. I am prepared to prove it, and I have proved it, I trust. The Government have left out of their calculations the fact that the British hold £900,000, that it never came into our hands, and that there is no necessity whatever to repay it. I submit that a case has been made why the Dáil should not give a Second Reading to the Bill. I submit that we are asked to endorse the failure and the gross ineptitude of the Executive Council to deal in a businesslike manner with the financial affairs of the country when they proposed to pay what has already been paid, coupled with complete ignorance of the British policy for the settlement of war debts. That is such as to require their resignation and to warrant from the House a vote of no confidence in them. I ask the House on this Bill to give such a vote, because I feel that it has been let down, and let down very badly, indeed.

Before the Minister replies I should like to make the point that there seems to be a good deal of unseemly haste in paying this so-called debt to Great Britain. It seems to my mind that we are not really indebted to Great Britain in this sum but as that is not the point now at issue you probably, sir, would not allow me to traverse it on this occasion. We have been listening to protestations of inability to pay rates and to complaints as to the uneconomic condition of the country from all quarters. It has come from representative bodies and representative men in this Chamber. Even the newspapers have initiated a campaign showing that the country is not able to meet the burdens necessary for its own existence: that is to say, it is not able to meet the burden of rates for the maintenance of local institutions. We have heard complaints that the country is not able to bear the burden for the maintenance of the roads and that it is not able to meet the burdens for the maintenance of the national services, yet now it is proposed to pay £400,000 away to the British Treasury.

We have scores of thousands of unemployed in this country; we have conditions of depression amongst the farming community and we know various ways in which money could be very usefully and legitimately employed instead of handing over £400,000 to the British Treasury. I cannot see anything in the agreement that compels us to put into operation, immediately, the terms of this agreement, and I should like the Minister for Finance to tell us, when economic conditions are so depressed here, when there are so many unemployed, when poverty and starvation are facing thousands of people, what is the necessity of depleting the National Exchequer of £400,000 and handing it over elsewhere.

It is hoped that better conditions will soon come about again and that the country will be in a more prosperous condition to meet its liabilities. But this is a liability we never should have accepted. It is a fact that the House accepted this liability but I suggest to the Minister that it requires some explanation to show why at this moment in the economic history of the country there should be this unseemly haste in paying over this money at the present moment.

I do not suppose I need follow Deputy Connor Hogan in much detail. The debt that we assumed liability for is not comparable to the French or Italian debts. These debts were incurred by these countries in the midst of the European war. This money which we got from Great Britain, not as money due but as an act of grace, was after the European war, and the terms and conditions applicable to those other debts are not terms and conditions fairly applicable to our debt at all. If we had paid the British in cash at the present time, we should certainly have to borrow at five and a quarter per cent. to pay cash.

Could the Minister state how much we would have to repay to the British in respect of this obligation of £4,300,000?

For a period of over 60 years probably 4¾ per cent. is a rate which will not hold. Money will be borrowed before the end of the period for less than that, but at present we have a certain advantage in it, and I think over the period it will work out as an equitable arrangement. We were generously met by the British in the whole matter, in the wiping out of Article 5 and in the arrangements in regard to the boundary. The rate of interest will, I think, work out fairly well. It will not work out greatly to our advantage, but I do not think it will work out to our disadvantage. Regarding the question as to the sum due by the British, and the interest on that, that leaves the question of interest on both sides—the interest due for moneys already paid, and paid for perhaps a couple of years, by the British, so that there is simply a cancelling out in that respect. As to why we should pay now, although there is nothing set down in the agreement as to when we should pay, it would be in the nature of an absolute breach of good faith if we were to treat this new agreement as something which was indefinite as to date, as Article 5 was.

Does the Minister suggest a breach of faith on the part of the Dáil, or only of the Minister himself? There is nothing in the legislation passed which compels us to pay this year any sum.

It would be a breach of faith on the part of the country. I think unless the country takes very definite steps to repudiate Ministers it is completely bound by them, and even if it takes steps to repudiate them it does not escape liability altogether. I think that is a fact that is apparent. In certain circumstances and crises Ministers have to act for the country. While the country can to a certain extent get rid of its responsibilities by certain actions on its own part it does not altogether escape. It would be, I think, completely in the nature of dishonouring our obligations if the Oireachtas refused to make prompt payment in the circumstances. I believe it would be a thing highly injurious to the credit of the country. We got rid of Article 5 on undertaking other obligations to repay these sums.

Can the Minister quote any statement made in the Dáil that this payment had to begin in 1926?

Not at all. I am not suggesting that. I am dealing not with technicalities but with the broad merits of the case. When we got rid of Article 5 on the undertaking to begin this payment the obligation was on us to begin promptly.

Whether we can afford it or not?

We can afford it as well as we can afford to pay the interest on the National Loan. We can afford to pay our debts, and, as far as I am concerned, I think there is no advantage in trying to avoid responsibility in that respect.

Question put. The Dáil divided: Tá, 31; Níl, 14.

Earnán de Blaghd.Seoirse de Bhulbh.Bryan R. Cooper.Máighréad Ní Choileáin BeanUí Dhrisceóil.Osmond Grattan Esmonde.Desmond Fitzgerald.Liam Mac Cosgair.Seán Mac Curtáin.Patrick McGilligan.Risteárd Mac Liam.Eoin Mac Néill.Seoirse Mac Niocaill.Liam Mac Sioghaird.Martin M. Nally.Peadar O hAodha.

Mícheál O hAonghusa.Seán O Bruadair.Eoghan O Dochartaigh.Séamus O Dóláin.Peadar O Dubhghaill.Pádraig O Dubhthaigh.Eamon O Dúgáin.Aindriú O Láimhín.Fionán O Loingsigh.Risteárd O Maolchatha.Domhnall O Mocháin.Séamus O Murchadha.Máirtín O Rodaigh.Seán O Súilleabháin.Mícheál O Tighearnaigh.Liam Thrift.


Pádraig Baxter.Séamus Eabhróid.David Hall.Connor Hogan.Tomás Mac Eoin.Pádraig Mac Fhlannchadha.Tómas de Nógla.

William Norton.Tomás O Conaill.Aodh O Cúlacháin.Eamon O Dubhghaill.Seán O Laidhin.Domhnall O Muirgheasa.Pádraig O hOgáin (An Clár).

Tellers:—Tá: Deputies Dolan and Sears. Níl: Deputies Baxter and Morrissey.
Motion declared carried.
Third Stage ordered for Tuesday, April 20th.

I move the adjournment of the House until Tuesday, April 20th.