The Parliamentary Secretary pointed out that the most recent publication of the commercial accounts of the Department of Posts and Telegraphs was in respect of the year 1928-29. It seems to us entirely unsatisfactory that Deputies should have to come to the consideration of the work of this Department on accounts which are two years old. We have had occasion in the past to make complaint concerning delay in publication of these accounts, and we think it would be a good thing if the Department would try to speed them up. There can surely be no reason why such a long delay should occur between the completion of the financial year and the presentation of the audited accounts to the Dáil. The Parliamentary Secretary has frequently asked the House to consider the work of his Department as it would consider the work of a commercial concern, because his Department bears, in many respects, close similarity to a commercial concern. It is obviously impossible to do that unless the accounts are available for examination. The importance of the rapid publication of these accounts will, I think, be more clearly understood when I show that, in some respects, figures given here by the Parliamentary Secretary in the past were found, when the accounts were published, to be incorrect.
The Parliamentary Secretary has pointed out that the Estimate for his Department this year shows a net decrease of £45,000. That decrease is, however, entirely accounted for by reductions in expenditure which are outside the Parliamentary Secretary's control, such as automatic reduction in the cost of living bonus consequent on the fall in the cost of living index figure; a decrease of £42,500 in compensation allowance payable under Article X; a decrease of £2,800 in the amounts of repayment to the British Government in respect of such compensation, and a further decrease of £4,800 in respect of agency payments in regard to compensation allowances. The total of such decreases exceeds the total decrease in the Estimate. In so far as the items directly under the control of the Department are concerned, there has been an increase. It is satisfactory to know that the postal branch of the Department is now on a paying basis.
We expressed the opinion some years ago that it was possible to put it upon that basis. We trust that the course of action which has been adopted, following upon our criticism, and which has achieved the object we foretold, will be continued, so that it will become possible in due course to effect a reduction of charges which will put us upon the same basis as Great Britain. I understand that a reduction in the ordinary postage rate from 2d to 1½d would cost approximately a quarter of a million. There is no prospect yet of such a reduction being made except at the cost of the taxpayer, to a large extent. Under present circumstances it is unlikely that any section of the Dáil would agree to the taxpayer being asked to bear a heavier burden for that purpose.
In relation to telegraphs, the situation is still serious, as the Parliamentary Secretary has told us. That branch of the Department continues to produce a large annual deficit. The deficit for last year, as given by the Parliamentary Secretary, is in excess of the total loss on the entire Department. The taxpayer is being asked to find the sum of approximately £110,000 this year in order to meet the loss on that particular branch. We are not satisfied that a loss of that magnitude is necessary. It will be remembered that about two years ago the ordinary charge for telegrams was increased by 6d. It was estimated by the Parliamentary Secretary and by the Minister for Finance that the increased charge would produce a saving of approximately £66,000 per year.
In the year following the imposition of that increased charge the Parliamentary Secretary, in dealing with the Estimate, gave to the House certain figures which he alleged indicated that the estimate of the Minister for Finance and himself had, in fact, been borne out. It was not possible for us at the time to check those figures, and on the Parliamentary Secretary's word we had to take them as accurate. Since then the commercial accounts for that year were published, and I, for one, was astonished to find that many of the figures given by the Parliamentary Secretary were not correct, and that the estimates of the Minister for Finance had not been realised. I am going to show that what I say is correct. The Parliamentary Secretary, referring to the effect of the increased charge, as reported in Volume 29, column 2010, said that in 1927-28—that is the last year in which the old charge was operating—the expenditure under the head of telegraphs was £378,016, and in 1928-29, the year in which the increased charge came into operation, the expenditure was £355,100, showing a decrease in expenditure of £22,916.
I have taken the commercial accounts of the Department for those two years and I have calculated the expenditure and found that the totals in each year differed considerably from those given by the Parliamentary Secretary. I take it that the total expenditure represents the aggregate of the amounts paid in respect of administration expenses, maintenance of the system, rents, rates, maintenance and repairs of buildings, pension liability, depreciation provision and the cost of renewals. The total of such expenditure, as shown in the commercial accounts for the year 1927-28, was not £378,016, as the Parliamentary Secretary stated, but £373,712. The total of such expenditure in 1928-29 was not £355,100, as stated by the Parliamentary Secretary, but £376,297. Instead of there being a decrease in expenditure of £22,916, as stated by the Parliamentary Secretary, there was, in fact, an increase in expenditure of £2,585. So much for expenditure. The Parliamentary Secretary, in the same statement, continued as follows:—"The revenue for 1927-1928 was £223,733, and the revenue in 1928-29 was £223,610, showing a decrease of £123."
The Parliamentary Secretary was correct in the figure which he gave for revenue in the first year, but he was incorrect in the figure which he gave for revenue in the second year. The figure which he gave for the second year was £223,610, whereas the figure in the commercial accounts was £220,219. Instead of the decrease in revenue being merely £123 it was, in fact, £3,514. The Parliamentary Secretary then continued, and said: "The loss on the telegraph service for the year 1927-28 was £154,283. The loss on the same service in 1928-29 was £131,490, showing a decrease in the loss of £22,793." The actual figures as shown by the commercial accounts are as follows:—The loss for 1927-28 was £149,979, and for 1928-29 was £156,078, showing not a decrease in the loss but an increase in the loss of £6,099. As I have said, the increased charges for telegrams were estimated to effect a saving in a full year of £66,000. The charge did not, in fact, come into operation until the 1st of August, and operated therefore only for eight months of the financial year. The saving during the eight months should have been two-thirds of the full amount, or £44,000. The Parliamentary Secretary stated that a saving of that amount was in fact achieved. He said that in the first three months of the financial year a loss of revenue of £5,900 was shown, which would have meant a loss on the full year of £17,700 if the increased charge had not been made, whereas he proceeded, the actual loss was, in fact, nil.
He took in addition to that £17,700 the figure he gave of the decrease in expenditure attributable to decreased traffic following the increased charges—£20,000—and he proceeded to add these two figures together and got £37,700. In order to make up his £44,000, therefore, he said that he attributed a considerable part of the increased revenue from telephones to the increased charges and took credit for £8,000 which he added to his previous £37,700, getting a total of £45,700. He gave that figure to the Dáil as the actual saving, effected by the increased charge for telephones which he said more than justified the estimate given by himself and the Minister for Finance when the Bill making the increased charge was before the House. What do we find was the actual position? We must take the Parliamentary Secretary's figure concerning the increase in the loss during the first three months in the year. It is not possible to check that figure from the commercial accounts. We have got to take the Parliamentary Secretary's word for that. We must assume that the loss for the full year would have been £17,700 if the increased charge had not been made, but assuming that that figure is correct we find that the actual increase in the loss was £3,514, which, therefore, we must deduct from that £17,700, leaving us in that respect with a net saving of £14,200. I have shown that instead of a decrease in expenditure of £20,000 there was in fact an increase of £2,585. We must add that.
The third item which the Parliamentary Secretary took into consideration was the increased revenue from telephones. On examining the accounts I found that between 1925-26 and 1926-27 telephone revenue increased by 5.8 per cent.; between 1926-27 and 1927-28 telephone revenue increased by 7.2 per cent.; between 1927-28 and 1928-29, the year with which we are concerned now, telephone revenue increased by 9.9 per cent. The increase in the latter year, therefore, does not appear to be abnormal. Nevertheless, if we allow the Parliamentary Secretary's figure of £8,000 as the proportion of the increased telephone revenue, which might be attributed to the increased charge for telephones, we get this result: the loss of revenue represents £14,200, less an increase in expenditure £11,600, plus the increased telephone revenue £8,000, giving us a total of £19,600 or, on the basis of a full year, £29,400 and not the £66,000 estimated by the Minister and said to have been realised by the Parliamentary Secretary. If the increased telephone revenue is left out of account the saving on the basis of a full year was only £16,400.
I submit that it is a serious thing, the Dáil having passed an Act involving an increased charge for the public services, if the Minister responsible, coming to the House for the purpose of justifying such action, gives figures which, on examination, cannot be shown to hold water. The Parliamentary Secretary set out to prove here that the Estimate made had been realised in full. The commercial accounts for these two years, now available to Deputies but not available then, show that the Estimate had not been realised even to the extent of fifty per cent. I would remind Deputies that included in that figure, £19,600, as the actual saving secured in that year, are figures which the Dáil has no means of checking. They are based entirely on estimates of the Parliamentary Secretary, in the first instance, as to the probable loss if the increased charge had not been made, and in the second instance as to the proportion of telephone revenue which might be attributed to the increased telephone charges. That is the financial history of that transaction.
Let us look upon the other side of the picture and find out in how far the anticipations of the Minister in respect of the telegraph service were realised. The Minister for Finance, speaking on the Telegraph Bill, Vol. 23, column 1964, said: "The Post Office believe that there will be only a small reduction in the number of telegrams sent, and that it will be possible to offset the loss of revenue in that respect to a large extent by certain economies which may be made possible." I have shown that instead of economies being made there was, in fact, increased expenditure in the following year. I find also that between 1927-28 and 1928-29 the number of ordinary telegrams forwarded showed a decrease of 15 per cent., which, I think, cannot be described as a small reduction. The number of telegrams sent per head in the Twenty-six Counties for the year 1923-24 was 1.15. That had fallen in the year 1928-29, the year for two-thirds of which the increased charge was in operation, to .9 per head, and continued to fall in the following year until it had reached a figure of .7 per head. We are, therefore, forced to the conclusion that the Dáil was induced to agree to the increased charges for telegrams on incorrect estimates submitted to it by the responsible Minister and the Parliamentary Secretary. That increased charge has had effects entirely different from what we anticipated, and if to-day we are faced with another heavy deficit on the telegraph branch it is largely due to that mistaken policy.
When the Telegraph Bill was before the Dáil it was stated that the cost of each telegram handed into the Post Office was 2/7; it has, of course, since increased. The traffic has declined, the expenditure has gone up. The cost per telegram, therefore, must have increased substantially since. That is due to the fact that no matter what the extent of the traffic the same machinery must, to a large extent, be maintained. If we have a telegraph service at all we must have facilities for sending telegrams to all parts of the country. The only real economy which could be made in respect of the telegraph service at present is to abolish it altogether, or else to devise some means by which traffic would be so increased that it would pay to maintain the machinery. I do not think that it is possible to find that means increased charges. When the Telegraph Bill was before the Dáil, I was rash enough to make a prophecy that the anticipated saving would not be achieved. I was surprised when the Parliamentary Secretary said it had been achieved, but now that the commercial accounts are available, I find my original anticipation was the right one. The putting on of an increased charge which was bound to decrease the traffic could not be a saving in the circumstances of the case. If the telegraph branch is to be put on a paying basis it must be, in my opinion, by so decreasing the charge that a vast increase in the volume of business will result. I believe that if it was decided not merely to decrease the charge but also to increase the maximum number of words that could be sent for the minimum charge from 12 to about 30, it would be of very great assistance and convenience to the business community, who would not fail to take advantage of it. In other countries they have a system of telegraph letters. It is possible for a fixed charge to send up to 25 or 30 words, and business people avail very largely of that service, because it enables them to send a letter in which it is possible to convey a clear meaning and to get a reply of the same kind on the same day. If the Parliamentary Secretary set out to develop a service of that kind here, I think he would find that more satisfactory results would be obtained than by action in the opposite direction such as has been taken.
We have, as we have been informed, reached the stage when the postal and telephone branches are not losing. The telegraph branch, however, is still losing heavily, and if the energies of the officials of the Department were now concentrated on devising a means by which that branch could also be made more economical and of greater service to the country, I think that the means would be found. I am not clear, however, as to how the deficit on the telephone service has been wiped out. Since 1924, when the charges were considerably reduced, the deficit on that service showed a decided upward tendency, until the year 1928-29, the last year for which the accounts are available, when the deficit was £34,719.
Last year the Parliamentary Secretary informed us that the estimated deficit for 1929-30 was £30,700, and on that occasion, and on all previous occasions, when the telephone service was under discussion here the Parliamentary Secretary emphasised that it was axiomatic in the telephone services throughout the world that extension of the service did not mean a reduction in the unit cost. He told us that the extension of the service may, in fact, necessitate increased charges, the subscribers getting in return for these increased charges a more extended service. He made repeated efforts to impress on Deputies that with the extension of the telephone service an increase in the annual deficit was to be anticipated. Now we are told the deficit has been wiped out. Is that due to a decrease in the extent of the service or to what cause? How is it that the Parliamentary Secretary has, in the last year, discovered a method of achieving what in previous years he told us was impossible of achieving, not merely in this country but in all countries? He instanced a case of the British telephone service which, although producing a surplus, was in consequence of the annual extension producing a smaller surplus each year.
When the Telephone Capital Bill was under discussion here some time ago considerable discussion took place concerning its efficiency. That discussion might more appropriately have taken place on this Estimate, but the Parliamentary Secretary will remember that one of the main points of criticism was the absence of a night service in rural areas. Some two years ago the Parliamentary Secretary announced joyfully that a new type of switchboard had been invented by him, and had been tried out successfully in County Dublin, and that in consequence of the success of the experiment he was now going to instal it in all rural exchanges, with the result that in a very few months night services at rural exchanges would be possible. That was two years ago. Did the switchboard not prove as successful as the Parliamentary Secretary anticipated, or what is the reason the service then promised has not yet been forthcoming?
These are the principal matters arising out of this Estimate to which I wish to refer. I would like, however, if the Parliamentary Secretary would inform us of the position of the Post Office Savings Bank. What progress is being made in getting Free State depositors with accounts in the British Post Office Savings Bank to transfer their accounts to the savings bank here? It is stated that the Saorstát deposits in the British Savings Bank are valued at £3,800,000. That is a large sum of money, and if it could be, by any means, transferred to the savings bank here it would be of considerable advantage.
I notice in the accounts relating to the savings bank here, which have been given us in the past, that there has been some increase in the number of depositors, but the increase does not represent the full number which have transferred from the British bank to the Free State bank in the past. Are we to take it that there has, in fact, been a lessening of thrift in so far as the utilisation of the Post Office Savings Bank is an indication of thrift? I notice also that the average deposit has been declining from year to year.
I also notice that the average amount of the credit on each account has been declining year after year. Is that decline due to the prosperity which the President talks about, or is it due to any desire on the part of these small depositors to avail of other thrift services apart from the Post Office Savings Bank? I would like also if the Parliamentary Secretary would inform us as to the securities in which the funds of the bank are held.
On the whole, the Dáil has no reason to be greatly dissatisfied with the financial effects of the working of the Post Office during the past few years. The large annual deficit of a few years ago has now been reduced to a comparatively small sum. That is something about which we can be all pleased. But I am convinced that even the small sum remaining can be wiped out if the job is tackled on the right lines. The loss is now concentrated on the telegraphic branch, and it is in regard to that branch I am almost certain that, with proper administration and the adoption of the right policy, the most satisfactory results can be achieved.