I wonder if the Minister for Lands and Agriculture will agree to finish his Second Reading Speech? I think it was recognised yesterday that he cut his speech short in the expectation that a division would be taken before private Deputies' business. There are a great many points that still require explanation, and, if I may respectfully make the suggestion, I think he should resume his speech.
AGRICULTURAL CREDIT BILL, 1928—SECOND STAGE (RESUMED).
Am I to take it that the Minister should be permitted to intervene again, but not to conclude?
If the Minister so desires, certainly.
Perhaps the best thing I could do would be to explain the Bill by sections and point out just what it means.
Personally, I would like to have some explanation as to the amount of injustice that this Bill is going to do. It is a case of striking a balance between the advantage that would be gained by making the Agricultural Credit Act more effective and the injustice that will accrue to certain people.
That is correct.
There would be in many cases an injustice to children and other helpless people, and while we are all enthusiastic to see the Agricultural Credit Act functioning, I do not think we should blindly take any action that would have the effect of inflicting great injustice.
The Deputy is correct. It does strike a balance. I presume everyone understands the effect of the Bill. It is, shortly, that a mortgage in favour of the Agricultural Credit Corporation shall have priority over equities. That is understood and that is in the second section. The third section is one which is rather complicated and it is a section in connection with which Deputy Ryan asked for an explanation last night. As, in fact, it is definitely on the point that Deputy Moore raised, perhaps I had better read the section. First of all, let us see what is the definition of "permanent improvement charge":—
the expression "permanent improvement charge" means a priority charge in respect of which it is shown by the mortgagor that the principal sum secured by such charge was advanced by the Corporation solely for the purpose of constructing buildings on the land the subject of such charge or for the purpose of making on such land improvements of a permanent character calculated to increase or facilitate or conduce to the increase of the productivity of such land and that the said principal sum was actually expended wholly for one or more of those purposes.
That defines "permanent improvement charge." That is for the purpose of increasing the permanent productivity of the land. It is money spent for a purpose which would be to the advantage, not only of the registered owner, but of anybody who has any claims against the land. It is a permanent charge and it will permanently increase the value of the lands. Now, Section 3 sets out: "A priority charge which is not a permanent improvement charge"—that is, something which will not improve the land, a loan for the registered owner—"shall as between the mortgagor"—that is the person who gets the loan—"by whom such charge was given and equitable claimants"—that is, brothers and sisters who have equities against the land—"(other than such mortgagor) against land affected by such charge be deemed to be charged on all and every (if any) estate and interest in such land to which such mortgagor was at the date of the registration of such charge or becomes at any time thereafter beneficially entitled in indemnification of all equitable claims against such land by equitable claimants other than such mortgagor."
That is the first section that protects the parties whom Deputy Moore mentions. Deputy Moore is right when he says that there are various interests in land. There is the interest of the registered owner and the interest of the equitable claimants. The equitable claimants in the case of a small farmer are generally a brother and sister. It is provided in the section that if a registered owner gets money for a purpose which does not lead to the permanent improvement of the land and if the land is afterwards sold by the bank or corporation, the corporation of course takes its charge out of the whole purchase money. On the other hand, each of the equitable claimants have a right to claim against the interest of the registered owner for that amount. That is the first safeguard. The second safeguard is in respect of minors, children and lunaties. That is dealt with in Section 4, which says:—"...where registered land is subject to a priority charge which is not a permanent improvement charge..." Where there is a permanent improvement charge, there is no need to make such distinction, because if the land is permanently improved it means that if the land is sold by the courts there is a bigger price because of the fact that it is drained, and there are better buildings on it, and all parties will benefit by that. So there is no occasion to give them any particular rights in that case, and the same distinction is made exactly in Section 4. It says:—
(1) Where registered land is subject to a priority charge which is not a permanent improvement charge and a person entitled at the date of the registration of such charge to an equitable claim against such land is at the date of such registration under the age of twenty-one years, or of unsound mind, such person shall be entitled at any time after such registration, but, in the case of a person under the age of twenty-one years at the time of such registration, not after he attains the age of twenty-five years to obtain from the Circuit Court an order that the mortgagor do, by giving security, lodgment of money in court or such other means as shall be approved of by the court, give to such person an indemnity which in the opinion of the court adequately protects the equitable claim of such person against the said priority charge, and that in default of the mortgagor giving such indemnity within three months after the date of such order the said registered land be sold by the court and the proceeds of such sale be applied according to law and that in any event the costs of such person in relation to such order, the application therefor and all proceedings thereunder when taxed as between solicitor and client be paid by the mortgagor.
That is the second safeguard for the equitable claimant. An equitable claimant can always apply to the Court to have his rights liquidated and in the long run can see that the land is sold, liquidated, that money is paid for it, and that the money is divided between himself and the registered owner, but an alternative procedure is provided for him here. He can go to the court and ask the court to make an order that the registered owner, instead of selling the land shall lodge in court securities which will cover the amount due to the equitable claimant out of the land. That is not very much of a safeguard. It is up to a point. It simply gives the equitable claimant an alternative. It does not take away any rights which he might have in law as the law stands to come to a court and have the estate administered, sold out, realised and the proceeds distributed in accordance with the equitable claims. It does not take them away, but these are rights which a brother or sister for several reasons are slow to exercise. They do not want to exercise them for one hundred and one reasons. It may be the wrong time to sell and there are a great many other points of view. Anyway, they are rights which a brother or sister does not care to exercise sometimes. This is of some value; it gives them a right to go to the court and ask the judge to make an order that securities are lodged in court sufficient to cover the amount of the claim rightly due to the equitable claimant and in default of that to have the lands sold. These are the only safeguards we can suggest for equitable claimants. They are of some value especially the safeguard in Section 3. It does in fact mean when you take this into account that the Agricultural Credit Corporation will not lend more than 50 per cent. of the value of the land stocked. They never lend more than 50 per cent. of the value of the security. When you realise that the amount they lend is always less than the total value of the security, in fact never any more than 50 per cent. of the security which is the value of the land and when you realise that equitable claimants have a claim against all the interest of the mortgagor then you can see in Section 3 which gives them that right that they have a very considerable safeguard.
Certainly, in most cases, in view of the fact that the Agricultural Credit Corporation never make a loan which is more than 50 per cent. of the total value of the land, they are fairly well safeguarded. But there is this other consideration to be taken into account, and this is the practical thing. All small farmers are registered subject to equities, but in 90 per cent. of cases there are in fact no equities that would in the ordinary way even be enforced. There are, of course, certain cases where people have gone to America and never came back. They are equitable claimants, because they were left some time before. Their father died intestate, but in fact they never claimed, but they can take it if they come back. I am probably speaking to persons who know far more than I do about this question.
With regard to the Local Registration of Titles Office, in at least 90 per cent. of cases there are no equities that would ever be enforced, so you are left with the ten per cent., and we have tried to safeguard that ten per cent. in this way.
The Agricultural Credit Corporation are up against this difficulty, that although it is no injustice whatever in 90 per cent. of cases to get priority for their mortgages over equities, nevertheless as the law stands they cannot get that, and as they cannot get it, and as there is no feasible alternative, their operations are entirely held up. There is no feasible alternative, because it is too costly and slow to ask the small farmers to discharge the equities. It costs anything from £5 to £25 to discharge the equities, according to the size of the holding and other circumstances which are entirely different circumstances. In a small holding it might be very hard to discharge equities. There will be intestacies. People far away, people whose addresses could not be found, and so on. The Deputy may take it that the cost of discharging equities is anything from £5 to £25, and always entails great delay. There is no alternative to discharging equities. The small farmer cannot afford to spend £5 to £25 until the equities are discharged and cannot afford to wait. Therefore, there is no alternative except this, and either this right is to be given to the mortgagors or the Agricultural Corporation. This is a right which does not, in fact, affect the equities of 90 per cent. of the holdings, and that is the opinion of the Registration of Title Office. These considerations apply especially to small farmers, but do not apply to anything like the same extent to big farmers.
There are real equities there. Take a man with £3,000 or £4,000 worth of land. There are family charges deliberately placed on that land. Certain people—an aunt, a brother, a man's sister, and so on—have been led to expect certain benefits from that land, and that farmer who owns anything from 100 acres to 400 acres of land has a lot of property. It is only right and equitable that his brothers and sisters should have certain charges which should be paid. In fact, in practice those charges are put on this land, and the people whose charges are put on expect them to be honoured, and the owner of the land contemplates that he is to pay these charges. In such a case of big farms it would be grossly unfair, and this is an answer to Deputy Doctor Ryan's question last night, instead of making a limit of £200 the limit should be ten times the Poor Law valuation. That would bring it up to £2,000. If you could make a loan of £2,000 to a farmer with a valuation of £200 without discharging the equities, then you get into a totally different case. It would be most unfair to do it. In my opinion, you would be much more likely to do wrong or defeat the equitable claimant who has a right to expect something out of the land, and for that reason we have chosen to adopt the principle that this Bill shall apply to lands up to a certain limit. The limit is £200 rather than a limit which will have any reference to the Poor Law valuation. We do not propose in the case of a big farmer, where there are real equities existing, charging anything. In a great many cases there are real equities existing. That figure of 90 per cent. would not apply to that. I should say in the case of 60 per cent. of these farmers there are real equities existing. If a man applies for a loan of £2,000 he ought to be able to afford to pay £10 for the purpose of discharging the equities. He is in an entirely different position from the small farmer who wants £200. That is the only answer I can give to Deputy Moore or other Deputies like Deputy Maguire who made that point. This is a balance, an attempt to choose the lesser of two evils. There is no doubt about it, and I say that from experience, not only here but as a solicitor, that so far as small farmers are concerned it will not do injustice. It is a serious thing to do injustice even in a small percentage of cases, to take away rights in a small percentage of cases, but as a result of Section 3 we preserve fairly well all the rights we have. In fact these are the two difficult sections in the Bill. That is the whole Bill, and when I have said that about these two sections and explained Section 2 I think I have explained the whole Bill. There are other considerations, of course, which possibly I will get an opportunity of dealing with when concluding. They are points that were raised in the debate yesterday evening.
I am grateful for the lucid explanation the Minister has given. I am very glad to hear that there are only ten per cent. of claimants.
I say that is an outside figure. It is a conservative figure; between 90 and 95 per cent. would be more like it.
It rather surprises me, from my own knowledge, because it so happens that in reading this Bill I can think of numbers of small farmers I know. One's own experience is that there are a good many small farmers in the position that equities are not discharged, and it is reasonable to assume from that that the average in the country is very high.
There are practically no farmers who have equities discharged—none. But my point is that, though equities are not discharged in 95 per cent. of cases as far as small farmers are concerned, there are no equities which ever would be enforced against them. Does the Deputy follow me?
I follow the Minister now, but I would not be so sure of that.
That is the view of the Registrar of Titles.
With regard to the big farmer, the reason for fixing the maximum at £200 is not to me satisfactory. Often there are good reasons for not discharging the equities; often it is not indifference or anything else. I know some cases where, I think, it is quite proper for the possessor not to discharge the equities. It would mean sending certain substantial sums of money out of the country to people who are not expecting it, and who really do not deserve it. I think it would be worth while considering that point in Committee as to whether the £200 maximum should not be raised. Yet I feel more satisfied than before the Minister made his statement as to the small injustices that will be inflicted by this Bill. I think we should be very careful to see that the Bill is as perfect in that respect as we can make it. It is very easy to defeat our own interests, and no one should take a light view of it.
Suppose there is a farm worth £300. The registered owner is A.; his brother is B. They are equally entitled to the farm, but A is the registered owner of the place. The Agricultural Credit Corporation grants a loan of £150. A gets the loan and it is registered against the land; he fails to pay back, and the Agricultural Credit Corporation sells the farm for £300. They take £150, and there is £150 left. The other brother has a claim to the whole of that £150, because that is the value of the registered owner's share.
Is it not thought necessary to protect the equitable claimants in the case of permanent improvement? It is possible that a farm that would in certain respects be permanently improved may, from the point of view of the claimants, be not so improved. I could easily see people spending hundreds of pounds on a small farm that would not increase the selling value of the farm to the extent of hundreds of pounds. I think that would be the common case in many places, particularly if the person in possession were not friendly with the other claimants. If he felt that he could build a very good house for himself, for instance, through a loan from the Agricultural Credit Society, it is quite imaginable that he would be inclined to do so, and, as a matter of fact, in the estimation of other people, the additional value of the house would not have raised the selling value of the estate proportionately. I understand also that this Bill does not cover land that is not vested in the Land Commission.
There is still a considerable amount of Land that is not vested in the Land Commission, and it will be serious if it is not brought within the scope of the Bill. It is remarked here on my right that one-third of the land is not yet vested. It is a pity, I think, that there was not an attempt made to make this a more complete Bill. I think the Minister will have to face the problem of bankrupt farmers. There is a big number of them throughout the country who will not get a loan from this Corporation or from any bank. The country cannot afford to see these farmers emigrate or become dependent on Home Help or something of that kind. Numbers of cases that I have been asked to interest myself in have been cases of that type, people who have no credit in the world. In some cases they are good farmers; they would, if they got a start, possibly be able to make a success of their farms. Certainly, I cannot see that the country can afford to say to them: "You have got to clear out; we have no use for you; we cannot help you to get going on your land again." It would be worth while, I think, considering whether a court of some kind could not be set up to deal with such cases, and to see whether there could not be some method of liquidating the debts of these people, so that they may get going on their land. In many cases they have not been able to get seed; they have no stock on the land. There was one case that I was asked to interest myself in, where on a farm of well over 100 acres the only stock were a couple of brood mares. That land was waste.
That is probably why he was in a bad way.
Obviously that land is waste and the buildings on it are of no use. Something will have to be done in such cases. I think it is a pity that an effort was not made to bring such things within the scope of this measure. We would like to have heard what the experience of the Agricultural Credit Corporation has been up to the present. We would like to have had a statement as to what the main applications are intended for, and what the prospects of the Corporation being useful are and general information in regard to it. I am not as enthusiastic about State socialism as Deputy O'Hanlon was last evening, but I think that in any relations between the Government and the Corporation it should be provided that we would get a clear statement as to the experiences of the Corporation and as to what it hopes to do for the farmers of the country.
took the Chair.
I welcome this Bill, because I realise that in every case in which an application for a loan was made in my constituency this crux arose and advances were refused generally. Consequently when this impediment is removed we will have an opportunity of judging whether the Agricultural Credit Corporation carries out all the work that it is supposed to do. I have no qualms about injustice arising out of the equities. I know that in the case of a small farmer whose land is unstocked, and who is probably in debt, no claimant is going to sue in the courts, and whatever chance such a person may have of getting anything, it is when the farm is stocked and the farmer gets on his legs again. I think that there is too much of the old conservative spirit of banking about the Agricultural Credit Corporation, so far as I have observed it up to this. I do not think that it is right that an amount representing only 50 per cent. of the value of the farm should be advanced in the form of a loan. All the circumstances should be taken into account, and where the claims against the land are not very much, and where a farmer has shown improvement in the valuation of the land during his period of occupation, the loan should be measured according to that value. Another matter in connection with these loans is that, apart from the interest being too high, which it is, the method of repayment is too hard under present circumstances. So far as I understand, a loan is advanced for, say, five years and the person who gets it has to start repaying the capital in half-yearly sums. Five years, in the first place, is too short. At least half of the period should be allowed to elapse before the repayments start.
My idea would be something along the lines of the system adopted in the Agricultural Credit Act passed by the British Parliament, but it should, of course, be more definite, say a period of sixty years. I will, I suppose, be met with the argument that a farmer should be able to repay a loan advanced for stock in a much shorter period. That would not apply in all cases. In cases where a man is under a big amount of debt and where the land is generally poor, a period of five or ten years would be altogether too short. Deputy Moore, in the course of his statement, referred to farmers who are bankrupt or on the edge of bankruptcy and whose farms are depleted of stock. Take the case of a man who in the height of the war years, at the peak of inflation, bought a farm for say £2,000 and it has now dropped in value to about £800. That is a big estimate. That man finds that he cannot sell his farm or get the valuation reduced and the bank which advanced the money insists on the whole amount being repaid. Ultimately, after unnecessary suffering and prolonged processes in law, they have to accept the present valuation. I have been told that such matters are questions between the bank and the individual. I think that the Agricultural Credit Corporation would be doing a great service if they intervened in such matters, arbitrated, fixed a price, and advanced the amount of money required to repay the bank. That process will drag on and it will retard agricultural progress. Why not settle the matter in a systematic way and extend the repayment over a period of years? Otherwise it will be no good, either to the farmer or the bank. The necessary credit could be created to do that.
As regards the amount of the advances which the Corporation are to make now that a certain barrier has been taken out of the way, I hope in view of the fact that they will only be able to advance one and a quarter million in the first year according to the amount of capital they call up, that their operations will be speeded up, and that the advances will not be limited to the present amount. If they find after seven or eight months that they require further money, the Minister for Agriculture or the Minister for Finance can come to this House and ask for greater powers for the Corporation. The Banking Commission in their second interim report quoted the Minister for Agriculture and Fisheries in Great Britain as saying: "Before the war it was commonly considered that a farmer should possess working capital for ordinary purposes amounting to about £10 per acre. At the present time the corresponding amount is about £15." The Banking Commission commenting on that statement said: "We do not think that it can be contended that the average working capital at the disposal of farmers in Saorstát Eireann is anything like the figure of £15 here mentioned, though the higher percentage of tillage in Great Britain naturally calls for a greater amount of such capital." Let us consider these figures and let us consider the number of derelict farms, half stocked farms, and the number of farmers in debt in every parish. Let us assume that there is only a deficit of £2 per acre on working capital, which is a very conservative estimate. That means that on twelve and a quarter millions of acres of tillage and agricultural land you would need twelve and a half millions, and you are providing only seven millions for a period of six years.
Would not £2 an acre make the land dear along with the existing rents and taxes?
This is to give fresh capital. Let it make the land dear. That is all the better, because you are preserving the interest of the tenant. You are preserving the existing tenants in their holdings. The alternative is that they would have to get out and migrate. Even if an inflationary process arose out of this it is much better than the present state of things. I do not know what particular information the Agricultural Credit Corporation gets with reference to the suitability of applicants for advances.
On a point of order, would the Deputy say what section of the Bill this refers to? He has been speaking for the last twenty minutes, and I have been vainly trying to understand what section of the Bill he is dealing with.
For Deputy Wolfe's information I might say that the discussion started here yesterday, and it followed the trend on which I am going. We are trying to state things that we know to exist.
Which section of the Bill are you dealing with?
I think that on Second Reading it is permissible for a Deputy to suggest things that might be in the Bill. I therefore suggest that Deputy Wolfe is out of order.
I understood that we were discussing a Bill. If the Deputy is discussing the Bill I want to know what section he is referring to. I suggest he is not discussing the Bill.
This is the Second Reading of the Bill, and on Second Reading it is permissible for the Deputy to criticise the Bill either for what it contains or for what he thinks it should contain.
For Deputy Wolfe's information, when we approached this Bill in a spirit of cooperation, I suggest when we know that certain things are not operative under the original Bill and suggest ways in which they could be operative, we are quite in order and that such a suggestion should be welcome. I was going to ask when certain applicants make application to the Agricultural Credit Corporation, how does the Corporation find out the suitability of these applicants for advances?
The Deputy is going near the verge of being out of order now.
I will try to keep in a bit. It is very peculiar that when two neighbours apply for a loan one should get it and the other should not, and the latter is apparently in better circumstances. I can give an example here without quoting names. There was an applicant who had ninety-one statute acres of £59 valuation. On that land there were nine stores value £12 each, two cows valued £20 each, two horses valued together £36——
The Deputy is now discussing the administration of the original Act, and that is certainly not in order.
Of course the equities may come in there. Now that the question of equities has been dealt with in an equitable fashion, such a case like this should meet with greater consideration where there are no bank debts and no annuities or rates due. I cannot give further examples, but there is one thing I wish to point out, and that is, that if the Corporation find after a period of six or seven months that they are not dealing speedily enough with applicants, and find their funds are running short, I hope they will come to this House with a fresh Bill asking for greater powers. I hope the Government, which was so liberal in giving a fiduciary note issue of six millions to the banks at one-and-a-half per cent., will say: "We will give a similar amount to the Agricultural Credit Corporation at one per cent. for the benefit of the farming community.'' There is nothing revolutionary in that. What has been done in such places as Esthonia, Lithuania, Latvia and Australia, we can do as well.
This Bill, I am glad to say, will remove some of the obstructions that were in the way of the Agricultural Credit Corporation. I expect another Bill will be necessary to complete it, in order that it may bring at least a certain amount of benefit to the farming community. The idea of credit corporations, credit for farmers, is really a good one, but I fear that this particular system which we have adopted has been largely influenced by the banking profession of this country. As a commercial concern, the banking system, I am sure, is all right and quite satisfactory, but for the agricultural industry the present banking system is not satisfactory. It is not a good idea, I believe, that the Credit Corporation should allow itself to be influenced to such a degree by these institutions. The conditions, to my mind, are really more severe than obtain in banking. If there is one thing that the farming community do not understand, it is that system of red tape, and probably what appears to them, anyway, as the unnecessary information that is asked for.
I am sure it is the experience of the Credit Corporation up to the present that many of these forms have been improperly filled in by persons applying for loans. Perhaps they, at times, attributed that to some idea on the part of the farmers that they would get a little extra or would influence the Corporation. That was not generally the case. Farmers are not great bookkeepers. They are not like commercial firms, with directors and a staff of clerks. These directors or owners are themselves accustomed to keeping books and to filling up official forms. Farmers have great difficulty in filling up these forms, and have made mistakes which were not dishonest. If such cases were inquired into it could be proved that the mistakes were not intentional, that items that should not have been put down were put down through ignorance.
It is no doubt a good thing on the part of the Credit Corporation to protect themselves against bad debts and losses. If I understand the matter correctly, I believe the aim of the directors is to make a hundred per cent. success of the Corporation. One hundred per cent. successes are not easily obtained. Business firms and others are content with much less. They all start out with the intention of taking an average amount of risk. I believe that the Credit Corporation should start out with the intention of taking a risk and not be too much afraid of making mistakes. Mistakes are made and will be made, and those who are afraid to make mistakes very seldom succeed. I believe the restrictions are too severe; that there are too many precautions taken to ensure the success of the Corporation. I believe that they want to be more generous, that the farming industry deserves from the State much more generous treatment.
The speech of the Deputy is rather one on the Act than on this Bill.
This Bill is to remove certain restrictions or impediments that remain in the path of the success of the Corporation and of the farming community, whom the Act was intended to make successful. I want, as far as possible, to put the idea that lies behind the farmer's mind in order that it may be thoroughly understood what is really irritating to him or what prevents the success of the Bill. No doubt it might be better, and more successful, if instead of giving the subsidy direct to the farmer, it could be given to the man who consumes. It is quite possible that the farming industry would be stimulated, that the market would be there for the farmer to sell his products. That is a rather impossible method under present conditions, and the method that has been adopted is the Credit Corporation. But as long as these impossible conditions remain, and the farmer is tied down by red tape, it will not be very easy to give him credit.
I advocate more generous treatment on the part of the Corporation; that a simpler system should be adopted; that the giving of credit should be quickened and the disappointments that exist removed. I hold that the present Bill will largely remove the impediments and, therefore, the disappointments; but up to the present there have been very serious disappointments to the farming community through the working of this Corporation. I have read in the newspapers and elsewhere promises that everything was going to be changed; that the Credit Corporation by giving credit to the farmers was going to be a sort of magic wand, and that the whole agricultural industry was going to revive. But when it came to be worked, and all these impossible conditions were put up, the farmers were sadly disappointed. I doubt very much even if this Bill will go far enough, for the reason that it is not generous enough. If this country is to be successful, the farming community must get generous and fair treatment. Conditions, rules and regulations are things that farmers do not understand. They fail to see why the form sent out has to be filled up so completely. I believe the form could be simplified; that the number of items in it could be reduced, and that it could be made much more understandable to men not accustomed to filling such forms.
Supposing the Deputy were lending his own money, how many questions would he ask?
Is either the Deputy or the Minister in order?
What the Minister asks is perfectly reasonable, but, under these conditions, I hold that it is not the money of any private individual or any banking system that is to be lent, but the money of the nation which is to be lent to a part of the nation, which has been robbed or starved up to the present. The greater part of the nation—80 per cent. of the nation—have been deprived of credit, deprived of capital to work their holdings, with the result that 50 or 60 per cent. of the country is nonproductive. This is an effort to cure that disease, but the amount is not sufficient, because the agricultural community have been completely dislocated, their capital has been taken away from them. They never had much capital and it is an industry that needs capital. If more capital could be given to the agricultural community, you would at once have more production from the land. The grazing system and the rearing of livestock have been adopted largely because there was not sufficient capital to work the agricultural end. If more capital could be advanced, if it is found that the Credit Corporation is 80 or 90 per cent. successful, and could advance some more, it would be all to the good and the success of the Corporation would be all the greater. If the Corporation are to be successful they will have to take more risks than they have taken, even with this Bill added on. They must be much more generous than they have been. The idea is a good one, but it needs a great deal of development before it can have any effect on the farming community.
I have listened with very great pleasure to the speech of Deputy O'Reilly, who always speaks so thoughtfully, and imparts interest to any matter on which he speaks. His great difficulty in connection with this Bill, so far as I can understand it, is that he is living in mortal terror that the Credit Corporation may earn 100 per cent. I should like to reassure him on that point. He need not be in any fear. There will be no such dividend as 100 per cent. paid by the Corporation.
On a point of explanation: I did not mention that the dividends were to be 100 per cent., but that the Corporation was to be 100 per cent. successful.
I understood that when the Deputy was speaking of 100 per cent. he was referring to income and not capital. However, I take it now that when he suggested 100 per cent. he was referring to capital, and that when he was suggesting a reduction below five per cent. he was referring to the limit to which capital ought to go. I was hoping that I would hear something from some of the Deputies about the Bill that we are discussing; that some Deputy or other would tell us something about equities. I knew they could give us that information but, for some strange reason, from none of the Deputies who have spoken except the Minister have we heard a word about equities.
I dislike saying a word of praise about any Minister. What has happened in connection with this Bill is that when a Bill was passed, owing to the peculiar system of the land registry, the Agricultural Credit Corporation were threatened with what is known as foot and mouth disease. Then they had only to appeal to the Minister for Agriculture and he brought this Bill forward as a tonic and cure for this foot and mouth disease. And in agreeing to say a word in his praise I would like to hear some suggestion from somebody as to how that tonic could be improved because, in my submission to the House, the Minister has shown not merely speed but unusual ability and ingenuity in dealing with that very difficult problem. Could any one of us, no matter from which branch of the Opposition we come, give him one suggestion as to how he could, in the slightest degree, improve on the suggestions he has brought forward in this Bill?
I personally, perhaps, may know something, or I may not, about land registration, but looking at the Bill, and I have looked at it with one object only, I can make no suggestions to this House that would in any way improve the objects of the Bill. I have read it and re-read it. I know it is difficult and may not be without faults, but as to the cure for these faults, nothing but experience will bring us that. I do think this is a measure which the country is calling for, and that it ought to be passed, and speedily passed. It is up to the House to see that the Bill which is brought forward, and which has the unanimous approval of the country, is passed into law in the shortest possible period.
I believe this is a Bill about which there should be no difference of opinion, and that all parties ought to agree to. It is a most useful Bill, and we believe it should get a very speedy passage through the House. The main feature of the Bill, as explained by the Minister, is that if any person who has registered land wishes to borrow money it will be necessary where equities have not been discharged, to discharge them. This Bill provides facilities for a charge on these lands. As the law stands, it is necessary for a borrower to have the equities discharged on registered land. Under this Bill, it is provided that you can charge the lands. The discharge of the equities would cost money. It would cost £5 to discharge the equities on a small farm and probably more. This, coupled with the cost of the mortgage, and six per cent. interest on a loan of £50 or £60, leaves it of very little use. It means that the money is very costly. Let us see what it does mean. If a man wants to borrow £50 or £60 it will probably cost £4 to discharge the equities, from £3 to £4 10s. for the mortgage, and six per cent. interest added to that. That means that a man would start with an expenditure of £8 or £9. If he gets ten years to repay that money, instead of paying six per cent. interest on the money, it means that he would be paying about ten per cent. on £50 for ten years. That would be ten per cent. per annum. That is altogether too expensive. I would suggest also as to the expenses of the mortgage that that should be borne by the Corporation, or if the Corporation would not agree to that, at least that they would only charge the outlay, because, as I have said, it may cost from £3 10s. to £4 10s. for the mortgage, whereas the outlay would be only 15s. or £1. I suggest that the Minister in his reply should make some statement on these matters.
As regards a person who wants to borrow a few hundred pounds, he can, under this Bill, borrow this money and the charge in favour of the Credit Corporation will take precedence over equities. That, so far as the borrowers are concerned, is all right. How it will work out in equities the Minister has explained. It seems fair and equitable. As to the discharge of equities, there are in my constituency a number of people who require loans. We all know the plight of the farmers. They are in a bad way. In 1924, which was an exceptionally wet year, in certain districts in my constituency hundreds of sheep and cattle were lost. A great many of these farmers at present cannot borrow money. They had hopes that under Section 25 of the Agricultural Credit Act of 1927 they could borrow on a chattel mortgage. Now, it seems that is not operating. Why I do not know, but I can give you one particular case where a farmer who had nineteen cattle and eighteen of them died leaving him one. As it happened, this man had a mortgage on his land; he was unable to pay the interest on his mortgage and he was unable to pay the annuities. The result was that he got into a state of despair. There was a receiver appointed; the receiver was unable to let the land. The man left the district. This man had no control over the circumstances. He pinned his faith to getting a loan under the Agricultural Credit Act of 1927. Now it appears he cannot get a loan and I would like that the Minister, when replying, would make a statement on this. The Bill is an excellent Bill. It will be welcomed by every section of the community, and, as I said, it should be passed speedily through this House.
resume the Chair.
Everyone says that he is in favour of the principle of the Bill. It is the principle of the Bill which should be debated on the Second Reading and in that state of affairs I suggest it would be well to have a fairly long interval between the Second Reading and the Committee Stage. I wonder would there be any possibility of getting the Second Reading now in order to effect that purpose?
Can it be debated on the Committee Stage?
The sections can be debated in Committee.
If the Second Reading is passed to-night, that will give a fairly long time between now and the Committee Stage.
Might I ask one question?
Is there agreement that the Second Reading should be taken to-night so that the Committee should be taken next week?
What is the reason of the haste in taking the Second Reading to-night? I ask that, because in Committee we would not be allowed to give the same criticisms of the Act as we can on the Second Reading.
The point made by the Minister is quite sound to this extent: that in the case of all Bills, and more particularly in the case of Bills the principle of which is actually not going to be divided against in the House, the most important thing for the ordinary member is to have a fairly long interval between the Second Reading Stage and Committee. There is no doubt at all about that. That is common experience. The most important thing for the ordinary Deputy is to have a long period between the Second Reading and Committee. The same liberty does not apply to the Committee Stage as to the Second Reading Stage. As An Leas-Cheann Comhairle has been pointing out, the Second Reading Stage of this Bill does not give an opportunity of criticising the Agricultural Credit Act or the Agricultural Credit Corporation.
It is not a question of objection to the Bill, but objection to the administration of the Act; that is what the Deputies want to speak about. We have had instances to which we would like to refer.
Deputies cannot do that on this Bill.
The operations of the Agricultural Credit Corporation cannot be criticised here at all.
I think we have precedents for discussing and criticising other Acts in Amending Bills going through this House.
That was criticism of the Minister, and one of the things always in order is criticism of Ministers. Is there agreement, first and foremost on this matter, that the Second Reading is to be put through to-night?
You might know that at 10.30.
It will be too late then for the Minister.
I am not anxious to reply.
I think it is very unfair to rush this Bill and not allow people who want to speak on it to say what they have to say.
Deputies can say a great deal on the Second Reading of this Bill, but they cannot discuss the Agricultural Credit Corporation on this Bill.
In view of the fact that there is general agreement that the Second Reading should be taken as expeditiously as possible, perhaps you would extend a little latitude on the Committee Stage?
Yes, but I am not prepared to agree that the Agricultural Credit Corporation can be discussed in any stage of this Bill. That is certainly not the way to do it.
May one discuss certain sections which would tend to improve the Act of 1927?
Yes, and that opportunity will be lost after the Second Reading.
That is very important.
I welcome this new Bill, and I hope it will be some improvement, at least, upon the old Bill. I agree with some previous speakers here that this Agricultural Credit Corporation should be to some extent under the control of this House. After all, the State has advanced a considerable amount of the money, and the State should have some control in the disposal of that money. The Corporation, at the present time, costs a considerable sum of money. That sum, if given to the credit of the borrowers, would easily pay 1 per cent. on £600,000. The great complaint about this loan is that it is too dear. Farmers who are trying to get this loan from the Corporation could get it quite easily from a bank at the same rate of interest which the Corporation pays. If the State is to give them something, if it is to assist them, let the State assist them in earnest. Let them not do it in the way they are doing—giving them only what they can get elsewhere. We have a lot of discontented men at present, a lot of farmers who were expecting a loan on easy terms, and now, after waiting to stock their farms, after waiting for the Corporation, now find that they are to be disappointed, and are in a worse position than at first.
Another drawback, too, in connection with the Act is that farmers cannot borrow small sums up to fifty pounds, except through credit societies. We all know the small credit societies have been a failure. At least, they have been a failure in the County Cavan, and probably in other counties too. The result is that farmers who want a loan of fifty pounds have no means of getting it. When this Act was going through, I understood that some of this money could be devoted to the purpose of paying annuities.
It seems very hard lines on a man who owes a half-year's annuity that he is not allowed to pay it out of this money. There seems to be no reason for that, because if he could pay it he would get rid of some of his debts. The Government must acknowledge that, owing to the secret mortgage they have allowed in the Act, they have done a considerable amount of harm. They have stopped the shopkeeper giving credit for seeds and machinery.
Everywhere. They have stopped the banks giving a certain amount of credit, because they do not know whether or not there has been a secret mortgage on the farm. There is no means of finding it out. Solicitors, on the other hand, will not advise their clients to advance money to farmers on account of the secret mortgage. It has done a considerable amount of harm, and now the Government are not going to assist the farmers in the last moment. I think they should put on more speed and try to see what can be done. I made the suggestion here a couple of years ago that if they would give security to the bank and allow the bank to advance moneys, they would be in a better position, and it would save a lot of the expense incurred by the Corporation.
I beg to move the adjournment of the debate until tomorrow.