I move the Second Reading of the Trade Loans (Guarantee) (Amendment) Bill. The provisions of this amending Bill have to be looked at in relation to the principal Act, when it will be seen that in reality there are only two changes proposed and those are with regard to the amounts that may be guaranteed. Originally £1,000,000 was set aside as a possible fund to be called on for the giving of guarantees. That was divided as between the two main sections of the Act. Three-quarters of a million might be guaranteed under one section and one-quarter of a million under the other. The second provision has not been called on, to any extent, and it is accordingly proposed to have the principal Act amended so as to re-allocate that original million, making, now, provision for £900,000 under Section 1 and £100,000 under Section 2. The only reason for that is what I have remarked, that applications to no great extent have come in under Section 2. It is proposed, therefore, to have the main amount of money allocated to the first section of the 1924 Act. Outside that the Bill merely carries the existing Act on for a further year. It is only recently that a decision was come to with regard to the continuance of the Act.
About last Christmas this matter arose, in a peculiar way, for decision. At that time I felt that while the results of the Act had been disappointing, the number of applications received had shown, definitely, a necessity for some provision of this sort; but it appeared to me that whatever facilities were required were likely to be met in another way. Considering the slacking off in the applications which had just occurred about that time, I had pretty well come to the conclusion not to ask the Dáil to extend this Act any further. It may seem that I was coming to that conclusion very much earlier than was required by the point of time at which the present Act would expire, but the matter came for decision in this way. There was a company being started —the Industrial Trust Company. Two of the members of the Advisory Committee, under the Trade Loans Act, were to be associated with that, and I was faced with the difficulty, there and then, of finding a new Advisory Committee, even for the running out period of the 1925 Trade Loans (Guarantee) Act. The point had been raised even before that when one of the members of the Committee, Mr. Dowdall, in May, 1925, decided that his own business commitments were so large and the drain upon his time required by attention to the Committee's work was so great, that he would have to resign from the Advisory Committee. When he proffered his resignation in May, 1925, I pressed him very strongly to continue as a member of the Committee, until such time as I could discover somebody who was willing to take his place, and to that he agreed. In December last year Mr. Dowdall, for some different reasons, raised the question of his resignation again and did, in fact, send in his resignation. The other two members of the Committee, Mr. Smith-Gordon and Mr. Telford, the Chairman, were also very anxious at that period to retire. They put the point to me in this way: that if they continued to act as members of the Advisory Committee under the Trade Loans Act and were, also, associated, as they were going to be, in the new year, with the new company, it might put me in an invidious position afterwards if there was any criticism made of their continuing to act in this dual capacity. That led, at any rate, to a consideration of the continuance of this or any similar Act.
I reviewed the circumstances at that time and made up my mind, as I say, that there was no necessity to have the Act continued for another year. Having my mind fairly clear on that point I approached Mr. Telford and Mr. Smith-Gordon, and put it to them that inasmuch as fresh applications did not seem to be coming in, in any great number, and seeing that already they were seized of the facts of the applications which had come before them and that the setting up of the new Committee would necessitate delay and would mean the holding up of applications in process of being considered, and seeing that it had been determined not to continue the Act beyond July this year— on these grounds I asked them to reconsider the decision they had pressed upon me on several occasions with regard to their resignation. It was with a certain amount of reluctance that the two gentlemen agreed to act on the Committee. The position at the moment is that I am without an Advisory Committee. The Advisory Committee has broken up. Both Mr. Telford and Mr. Smith-Gordon have resigned, and the fact that they did not resign or were not allowed to resign last December, when they pressed they should be allowed to do so, was entirely due to me. My action is explainable for the reason I have given.
I insist at some length on this, because a discussion in the Seanad yesterday, and in the Dáil on an earlier occasion, if nothing else, must have revealed to Deputies that these two gentlemen have been criticised for continuing to act on the Advisory Committee while being associated with the Industrial Development Company. If there is blame attached to anybody for that it must attach to me alone. I insisted that they should stay on, and was barely able to convince them by the reasons that I put forward that they should remain on. No matter what discussions we may have afterwards with regard to this Bill or to certain incidents, or one transaction that has been unfairly criticised arising out of the operations of the Act, I would ask the Dáil to be quite clear about the position that these two gentlemen occupied. These positions have been very onerous and the work has been very responsible. They have given a tremendous amount of their time to the investigation of the applications that came before them. They have neglected their own business in order to give their attention and experience to the working of this Act. I feel that I should here make that statement with regard to them and I ask the Dáil to agree with me that some recogtion is due to the members of that Committee for the very onerous and responsible work which they undertook without fee or reward in helping a Department of State to carry out an Act which was brought forward in the best interests of the State and with the object of getting the conditions of unemployment bettered.
I am at the moment without an Advisory Committee, and as a result of the abuse that has been poured around certain people recently, I even hesitate to approach anybody with regard to acting on this Advisory Committee for the future until I see what action the Dáil may take this day with regard to the Bill or, apart from the Bill altogether, until I discover if this House is sufficiently aware of the services rendered by these two gentlemen and is willing to award them some recognition of their services. If that is done, then I can, with a certain amount of hope, approach other men of capacity and experience and ask them to act in the same position, if this Bill, renewing the expiring Act, be passed. There has been one transaction under this Bill very definitely criticised, and so far as I know there has been no word of criticism of the Advisory Committee nor, as I had to point out yesterday, so far as I know, has there been any criticism of the National Land Bank as a bank, for any part it may have had in the particular transaction to which I refer. But there has been criticism of the transaction; and on that particular transaction, inasmuch as it is relevant to the continuance of this Act. I wish to make certain references. The first criticism is contained in the Appropriation Accounts for the year 1924-25, in paragraph 91, where the Auditor-General refers, under the head of Vote 65—National Land Bank, Limited—to a certain transaction. It was in connection with the loan granted to Alesbury's, of Edenderry, and certain remarks were made with regard to that transaction, finishing with this: "In view of the limitations for guarantees of loans imposed by Section 1 of the Act, I did not consider that the guarantee in this case came within its terms, and I have deemed it necessary to call attention to it in my report." The Public Accounts Committee have discussed the same transaction and they have issued an interim report dealing with it. Unfortunately I do not think that the interim report can properly be discussed in the absence of the evidence. There has not been produced the evidence on which this interim report is based, and I have hopes that at some time before the Dáil rises we shall have an opportunity of seeing the evidence on which this interim report is based so that we may come to a conclusion as to whether and in fact to what extent the recommendations of the Public Accounts Committee should be accepted. There are, as far as I am concerned at the moment, three recommendations which have touched on this Bill or the continuance of the expiring Act, and they are given in paragraphs 14, 18 and 19 in the interim report. Paragraph 19 refers to the difficulty about defining what is "a capital undertaking," and the last three lines of the report state that "the Committee has been led to the conclusion that the expression ‘a capital undertaking' used in the section ought to be more clearly defined than it is in Section 8 of the Act." As I say, I have not the evidence upon which that report of that Committee was based. But an official of my Department attended for the purpose of giving evidence, and I did inquire from him as to what facts had been put before the Committee.
I gathered that a representative of the Auditor-General's Department, in giving evidence before the Committee, asserted that pretty well nearly every economist had a different interpretation of what "a capital undertaking" meant. And apparently the Auditor-General's Department has some interpretation of its own upon which this conclusion set out in paragraph 91 of the Appropriation Accounts is based. Now we have that statement that pretty nearly every economist has an interpretation of his own, and we are asked for the purpose of this Act to define better what a capital undertaking means. I have no dislike for a better definition, but I hope that the Committee's report does not mean that I am to bring forward a better definition. If there is any definition brought forward at the Committee Stage, or if there is a variety of definitions, we can have them considered and have the best one chosen and put into the Bill. With that I leave paragraph 19.
Paragraph 18 of the Public Accounts Committee's interim report states:—
"The Committee considers that the creation of a liability in front of a State guarantee is not desirable and should not be repeated."
I am not quite clear as to what is the effect of the recommendations of the Public Accounts Committee presented in this report, laid on the Table of this House and afterwards discussed. Is it that next year if some guarantee when given is seen to have involved the creation of a State guarantee which is postponed for some prior liability, I am to be held up to criticism and told: "Well, the Public Accounts Committee called your attention to that last year and it should not have been done."
If that is to be the effect of the recommendation I think we should have it more clearly before us. If there is anybody here who thinks the recommendation should be adopted, then further amendment of the Bill should be moved so as to make it quite rigid that where a guarantee is requested in circumstances where there is a liability in front of a State guarantee, that loan should not be guaranteed. I would like to warn the House that if that is put in the effects of the Act are going to be very seriously limited.
I may say that is the practice of the Advisory Committee. That is what they aim at. I do not know, as regards cases in which guarantees have been given, that there has been more than one other in addition to the Alesbury case in which there was a liability which was prior to the State guarantee. I believe there is one other case which is under consideration in which that might turn out to be so. That is definitely the aim, object and practice of the Advisory Committee, and the two Departments are in accord with that. I ask the House to hesitate before they put that into the Bill as a rigid rule. I should say the case other than the Alesbury case in which that rule was not adhered to is one of the best guarantees that has been given, and the State's secondary liability by way of guarantee is quite well protected even though there be this other liability in front of it.
In so far as this report of the Public Accounts Committee is to be taken as being a recommendation, a very definite recommendation, that something is not desirable and should not be repeated, I agree it is not desirable, and I agree it is not the practice. In every case in which it has been found possible we have always tried to get the State as the first charge; but it is not always possible, and, if other applications are to be ruled out because that is not possible, then the effect of that paragraph on the working of the Act is going to be rather serious.