I move that this Bill be now read a Second Time.
Finance (Increase of Income Tax) Bill, 1931—Second Stage.
Before the House agrees to the Second Reading of this measure I would ask Deputies, in connection with it, not only to consider the proposal in the Bill itself, but also the associated proposal to increase the tax upon transport. If any taxation is to be considered just and expedient there are four conditions which it ought to fulfil. It should be unavoidable; it should be opportune; it should be equitable, and it should be reasonable. It should be unavoidable in the sense that on a far-sighted, prudent and judicial survey of the present and future circumstances of the community, it is unavoidably necessary for improving or maintaining the standard of living of the people, or for the improvement or maintenance of the national estate. It should be opportune. If possible, it should not be imposed at a time when trade and industry are labouring in depression. It should be equitable. It should be distributed fairly over the several sections of the community according to their respective abilities to pay: those who have much to bear the heavier burden, while those who have little should be spared what they can. It should be reasonable. It should be within the taxable capacity of the people as a whole.
Judged by any one of these four principles, the proposals which the Minister submitted to the House on Friday last, the principal one of which is contained in this Bill, cannot be justified. Is any Deputy in the House satisfied that the new taxation is unavoidable? Deputy Davin, in one of the most effective speeches that I have heard from the Labour Benches, pointed out that the Government's policy was bound to affect the position of people who are in receipt of home help. He referred to the plight of the farmers who at present are receiving only 3½d. per gallon for milk, upon whom, in some cases directly and in every case indirectly, a considerable part of the new petrol tax will fall. He indicated that, in his opinion, an increase of taxation was undesirable. He even pointed out directions in which economies should be sought. I regret very much that Deputy Davin and his colleagues voted for the imposition of the new taxes before he or they could possibly be satisfied, as reasonable men, that the new impositions were absolutely necessary. I say that not in any spirit of captious criticism, but to make clear to our friends of the Labour Party what our own attitude is in this matter. I can understand the emotions which actuated them. The word "income" connotes for them a bloated plutocrat, and petrol is invariably associated with a Rolls Royce. But there are many weekly wage earners, not merely pen slaves, but manual workers, now paying income tax, and paying it on earned income. There are many farmers, many artisans, many labourers and many of the unemployed who will be hit by the petrol tax. If, by reasonable economies in administration these taxes could have been avoided, the workers for whom both sections of the Opposition in this House speak would have been spared.
We on these benches feel that the ultimate incidence of any tax is very rarely restricted to the individual upon whom it first falls. We believe that the burden of it is passed down and down the social scale until ultimately the greater proportion of it is transferred to the producers and wage earners in the community. For that reason, while we will not countenance any reduction in social services, or any attack upon the standard of living of the workers, whether in field or factory, we will oppose any proposal to increase taxation until we are shown that there is no other resort. If we want money for our social programme we shall endeavour to secure it by cutting down, ruthlessly cutting down, wasteful and unproductive expenditure. We will rely on economies rather than on taxation. Economy before taxation is our watchword. It is a sound principle for the people. It should, for the reason I have stated, be the guiding principle for the members of the Labour Party, too.
Like Deputy Davin and his Party, we insist that the Budget shall be balanced. Not only since we came into the Dáil, but even before that, we have pointed out to the people how utterly false and misleading were the statements of the President and Vice-President that the Free State Budget was being balanced from year to year. We pointed out the wretched chicanery of segregating certain items of expenditure as abnormal and defraying the cost of them by borrowing. We have opposed that borrowing because we are not prepared to mortgage the future of our country in order to indulge the Ministers in their present extravagance. We oppose borrowing now because, as we have often pointed out, the principal result of such borrowing as we have hitherto undertaken has been to leave less and less of our annual revenue available for social and productive services. If we say, therefore, that these taxes are unavoidable, we do not mean that the deficit should be met or could be met by borrowing.
There are many Departments in which economies might be sought. Deputy Davin indicated some of them. There is the Army upon which Deputy Major-General Seán MacEóin —by the way the Deputy seems nowadays to be making a great effort to swallow his own words—tells us that over £14,000,000 have been wasted. Are any of us in this House certain, before we impose these taxes upon the people, and make it a little harder for our poorer folk to secure bread for their children, that considerable waste does not still prevail in that Department? Are any of us satisfied that no portion of the £1,466,000 which it is proposed to spend this year on the Army could be saved, still leaving that force as efficient and effective as ever? Is there no danger that the whole of that sum may not go the way of the £14,000,000 which a Government Deputy in this House, over his written signature, has declared has been wasted? Or again take the £697,000 which it is proposed to spend on that circumlocution department known as the Land Commission. Are there no administrative economies possible there?
Is there any Deputy who has had any dealing with that Department who is not satisfied that if there was a thoroughgoing business administrator in charge of it the work could not be done with half the staff or in half the time that it occupies now, or in the Department of Local Government and Public Health which spends half a million, or the office of Public Works which is responsible for an expenditure of £900,000? Do we really need £1,600,000 worth of policemen in this country or is it necessary for us to spend £100,000 on our prisons? Even if we were convinced, and not one of us is convinced, that these Departments are run as economically as they could and as they should be, have we no other resources, before we resort to taxation in order to balance our Budget? What about Vote 16 under which we provide over £1,700,000 for pensions and superannuation allowances? I say that in their old age public servants are entitled to their pensions, if they have been earned by honest service to the Irish people, and that the Irish people are bound in honour and in duty to pay such pensions. But what of the £1,157,000 which we repay to Great Britain in respect of ex-R.I.C. pensions? Surely that burden does not properly fall on us. These people were not our servants, but the servants of our masters. We owe them no debt, no gratitude, no recompense. Why should we tax our people to provide for them? It is Britain's duty and Britain's liability and if we placed that duty and burden where it rightly belongs the whole of the anticipated deficit could be more than met without the imposition of a penny piece of additional taxation. Not even the super tax-payer would have to groan under the iniquitous assessments of the Inland Revenue Commissioners if the Government would only face up to the fact that we owe no debt to Great Britain in regard to R.I.C. pensions. We ought not and the Government ought not either sacrifice their less fortunate brethren in trying to find that £1,157,000.
Is this taxation burden opportune? I have shown it is not unavoidable. I have shown that there are within the State resources out of which the Budget could be balanced without imposing an additional 6d. in the £ on the income tax or an extra 4d. on the petrol tax. I think the arguments which I have adduced in support of the contention that taxation is avoidable cannot be answered.
Is it opportune? That question requires but one fact to answer it. In this morning's newspapers the trade returns for the nine months ending September, 1931, are published. What do they tell us? That the total value of our import and export trade for the twelve months ending September 30th has declined from £106,782,000 in 1930 to the figure of £88,950,000 for 1931, a decrease of almost £18,000,000 with an increase of over £2,200,000 in the value of the adverse trade balance. These two facts are surely portentous enough to make us hesitate before imposing additional burdens on our declining trade, upon our farmers, upon our workers and our unemployed and those who will soon swell that hungry army, if we do not hold back the hand of the Minister for Finance.
There is one fact which emerges from a study of the returns for September, and it is a fact that throws a searchlight upon our whole economic position. It is a fact which the Government newspapers this morning have suppressed. I refer to the catastrophic fall in the value of our export trade disclosed by the returns for September, as compared with our export trade for the month of September, 1930. In September, 1930, the total value of our export trade was £4,329,000, and in September this year our exports were value only for £3,231,621, a decrease of just under £1,100,000 as compared with the same month last year; while the adverse trade balance for the month increased from £484,400 for 1930 to £971,900 for 1931. The position in July, when the figures for the month showed a decline of £845,000, was bad enough, and in August, when the decline was £661,000. But they are wholly eclipsed by the black darkness of September, with its decrease of £1,100,000. And this in the very month when, according to the President and the Minister for Justice—I do not know what the Minister for Justice knows about the matter, but it is quite obvious that he and the President were speaking from the one brief—we were to witness a significant expansion in the normal value of our trade as a result of the British change. But the cold fact is that September has presented us with that abnormal decline in our exports.
October will be worse and so will November. Competition in the British market will increase because a sale must be found there for the produce which the decreased purchasing power of people elsewhere will not permit them to buy. In face of this intensified competition, in the very pit of the depression, when our producers are gasping for breath, the Minister for Finance and the Government tighten their grasp upon the throats of our people. Surely this is not the moment to increase taxation. Surely our people come first. Surely they are more to us than the ex-R.I.C. men; more to us than any bond or bargain with Great Britain? Great Britain is a defaulter. Great Britain has refused to honour her bond with our investors who placed their all in her Government stocks, and that refusal and that default have cost our people £75,000,000 in gold pounds. Even if Britain were ever entitled to the annuities or repayments for the pensions, surely we are entitled to hold them now as an equitable set-off. It would be but justice; it would be but equity, and the law of self-preservation, the paramount duty of protecting and preserving the standard of life of our own people, demands that it should be done. I said that taxation should be equitable, that it should be fairly distributed over the several sections of the community according to their ability to pay. How does the new tax proposed in this Bill fulfil that condition? It proposes to increase the standard rate of income tax by 6d. in the £, but it does not propose any corresponding increase in the allowances. What is the effect of that? Take a typical case. Take the case of a single man, a teacher perhaps. Deputy O'Connell voted for this tax. Take the case of a single teacher in the country with a total income of £160, all of it earned. Under the old rate he paid 13s. 6d. per annum, that is at the effective rate of 1d. in the £. Under this Bill his taxation will be quadrupled and he will have to pay £2 14s. 4d. Under the old law a married couple with an income of £300, all earned, paid £3 7s. 6d. tax, that is at the effective rate of 2½d. in the £. Under this Bill their burden will be more than double, and they will pay at the effective rate of 5½d. in the £. Their total payments are £7 8s. 6d.
How do you calculate that?
Ask the Income Tax Commissioners. Again, take the case of a married couple with three children. I am assuming now that the usual allowance at the half rate on £200 still remains. If the Minister wants to correct me and say I am wrong, that the full increase of 6d. is going to be imposed on these people then I will correct my figures but it will not be in the Minister's favour or in the favour of any one who voted for this tax. Again take the case of a married couple who have three children, living on an earned income of £400. They pay £3 7s. 6d. tax or at the effective rate of 2d. in the £. Under this Bill they will find that the effective rate of the tax has been multiplied 2½ times and they will have to pay £8 8s. 9d. These are all poor struggling families.
Taxation is funny to the Minister.
The Deputy's calculations are.
No one will contend that the married couple with children to feed and clothe with £400 have any surplus, yet the burden of income tax in their case is to be abruptly increased by 150 per cent. We have a bachelor in the country, a teacher, who is possibly looking out for a decent girl to marry him. Take that case. He earns his money and if he is only paid £160 I would say that he earns his money hard. Under the old rate he paid about 13/6 per annum and under this Bill his taxation will be quadrupled and he will pay £2 14s. 4d. Let us take a further case up the scale. Take the case of a bachelor with £1,000 earned from investments. On that amount he pays on that sum tax amounting to £112 17s. 6d. or at the effective rate of 2/3 in the £. The amount which he pays is large but the residue left for his own personal maintenance and enjoyment is large also. It amounts to £887 2s. 6d. He could better afford to bear a quadruple increase than the individual with only £160, every penny piece of which is earned. Yet while the effective rate of tax for the man with £160 a year is increased by 300 per cent. the bachelor with an income of £1,000, who toils not and spins not, or is not a supporter of the Labour Party, gets off with a comparatively insignificant increase of 22 per cent.
Mr. O'Connell
Wait until you get after them.
I hope you will uphold us in the same way as you uphold Cumann na nGaedheal when they come to apply an increase of 6d. without any compensating allowances.
Take the case of a married couple with an income from investments of £2,000 and having a family of three. They pay £235 17s. 6d. in tax and are left with a residue of £1,764 2s. 6d. to pay the grocer and the butcher. In their case they will have to pay an additional £50 or an increase of 21 per cent. but they will still be left with a trifle over £1,700 to drive the wolf from the door.
I have shown how the proposal in this Bill operates. I do not think it is a proposal which can commend itself to the House, and I do know the feeling that a number of people have with regard to the income tax, that it is a tax which one can impose with impunity. Nevertheless I think its operation and the effect of the increase ought to be very carefully considered before we vote for it. The primary consideration which the House ought to bear in mind is whether the taxes are unavoidable. As I said at the outset if the taxation is shown to be necessary in order to improve or maintain the standard of living of our people, then I for one would be prepared to support it wholeheartedly and all the members of our Party would, I am sure, take that attitude also, but we believe if it is possible by reasonable economies which will not diminish the effectiveness of our social services then before any further burden is imposed on the country those economies ought to be sought and ought to be made.
The Minister last week made some sort of promise that we would hear from him to-day what retrenchments he had in view. I was surprised when he contented himself with formally moving the Second Reading of the Bill. I thought he would have spoken and outlined to us what he proposed to do, but I am afraid that he has not been able even over the week-end to improvise the economies which he is ultimately going to put before this House. We were told in the newspapers that at long last the Economy Committee presided over by the Parliamentary Secretary to the Minister for Finance, the Deputy who is in charge of the Department of Posts and Telegraphs, would have submitted to us the result of its deliberations. The relations between the Minister for Finance and the Chairman of the Economy Committee remind me of a gentleman who went for a morning ride on a snail and who, to insure that he would not travel too furiously, bitted the snail with a snaffle. For over three years we have been waiting for the results of the Economy Committee's labour, and we are told that retrenchments are now in view. If retrenchments are possible now when all costs are going up, retrenchments were much more possible when all costs were going down, and any economy which might be made at the end of 1931 could very much more effectively have been made in the years 1928, 1929 and 1930. If there had been a real Economy Committee, designed with the intention of endeavouring to make more efficient our wasteful and extravagant Government Departments, we would not to-day be faced with a deficit which the Minister admits is £900,000.
We on these benches believe we are only at the edge of the cyclone. When we get to the real storm centre and conditions become very much worse the deficit will not be a figure of £900,000, but something in the neighbourhood of £1,500,000. But whether we give a Second Reading to this Bill or whether we agree to the Minister's proposal to increase income tax and the tax upon petrol Deputies may be certain that this thing cannot go on, that the country cannot bear any further increase in the burdens that are already crippling our trade and our industry and that ultimately the whole problem of the Ultimate Financial Settlement will have to be faced up to and that we will have to make up our minds that we are going to retain here in Ireland, for the use and benefit of the Irish people, the land annuities and the R.I.C. pensions which rightfully belong to them.
There were one or two features in the opening statement of the Minister for Finance in introducing this Bill to which I would like to refer. He suggested that there were two methods of raising this shortage of £900,000. One was by retrenchment and the other was by taxation. Like other speakers who have intervened in this debate, I personally feel that there should be no retrenchment on such items as old age pensions and little or no retrenchment on social services. I am hoping that when the Minister introduces his Budget he will have due regard to the expressions of opinion that have fallen both from the official Opposition and the official Labour Party, now depleted, of course, by two of its best members. One of the features was the fact that you have a shortage of liquor duties of something like £670,000. I rather question whether all this deficit or the greater portion of it is due to the causes suggested by the Minister. On this matter, I feel it would be far better to have prohibition and be done with it rather than starving this industry out of existence by means of extra taxation year after year and still being faced with a deficit in national revenue.
Another feature of the Minister's statement with which I do not feel myself at one is this: It appears to be the settled policy of this Government to make this generation pay for everything. I do not know whether that is good financial policy or not. I do not presume to be an expert in finance, but I do feel that posterity should be made to pay for something. This generation has had to pay for a whole lot of damage done during the Civil War and other disturbances in the country, and now we are asked to face up to this £900,000 deficit. Again, we are asking this present generation to foot the bill. I suggest that that is altogether wrong. Surely some of these charges should be passed on to posterity. Balancing the Budget has become a kind of fetish with the Minister for Finance. I feel, too, there is not such a great virtue in balancing the Budget. Some economists think it is a wonderful achievement to balance the Budget. The Minister for Finance in this Parliament has taken a pride in that fact, that he has been able to balance the Budget. The Cumann na nGaedheal Party have made wonderful propaganda out of the fact that they alone amongst the nations of the earth have been able to balance the Budget. Personally, I do not feel it is a wonderful achievement at all. While there are so many thousands of persons in this country unemployed, while there are so many thousands of persons underfed, and while there are so many thousands of persons who are not properly clad, and whilst there is so much poverty abroad in the land, I do feel that instead of coming to this House and asking for £900,000 to make up for this deficit, the Minister should come along with taxation of another character altogether. I would advocate that more money should come from those who can afford it, and that less should be inflicted by way of taxation upon those who can ill afford it.
I intend to vote for this measure because I find that we have no other way out of the difficulty. The Minister has stated that this £900,000 deficit is required by him to finance the services of the State, and I for one am not going to be a party to refusing the Minister that £900,000 if, as he says, it is required for these purposes. I have listened attentively to all the speeches made in opposition to the Bill, but no one has yet convinced me that we are going to improve matters by refusing to vote the £900,000. I am still open to conviction.
I think it was Deputy O'Connell who said that we were the slaves of an economic system. I was rather surprised at that sort of cheap stuff coming from Deputy O'Connell—"Slaves of an economic system"—something that we might hear down at the Custom House on a Sunday. Coming from an intellectual Deputy like Deputy O'Connell, I was rather surprised. Surely we must admit this much as men of commonsense, that there is economic depression the world over. It is no consolation, of course, to the hungry man in this country or the workless man or the underfed man to believe that things are just as bad elsewhere. It is no consolation to him to preach this doctrine that we are the slaves of an economic system which most certainly must be common to other countries. If we are slaves of an economic system, one of the richest countries in the world to-day— America—has plenty of poverty and of unemployment. We are the slaves of a world economic system.
Mr. O'Connell
Hear, hear!
The Deputy says "Hear, hear!" but he did not say that we are the slaves of a world economic system. The phrase "slaves of an economic system" had regard to our own economic system. Our own economic system may not be perfect— I do not suggest it is—but at least we should have the decency to say that there is world economic depression. I have certain ideas as to how that economic depression could be met in our own country.
I could make many suggestions to the Minister for Finance, who, in turn, might pass them to the Minister for Agriculture and the other Ministers of the State. We have a lot of land going untilled and unused in this country. I pass over hundreds of acres of land week after week, and not a sod turned in it. The speeding up of the division of land, through the Land Commission, would relieve to a very large extent the economic position of this country. There is a land hunger all over the country. In many cases, perhaps, the right people have not been put upon the land, but I could point out to the Minister many areas where it would be good, sound economic policy to put forty or fifty young farmers, the second or third sons of farmers, who are hungering for land at the moment. I do not know how far the Department of Lands and Fisheries is influenced by political considerations. I am not suggesting that they are, but I do feel that there is something peculiar—I had almost said something rotten, but I do not want to be using any hackneyed phrases—in the State when we have plenty of land available for all the men and women who are able to till it, and yet it is not broken up and divided.
The Minister indicated in his opening statement that we would have some kind of economies. I hope if economies have to be practised, and if retrenchment has to go on, that we will begin at the top and not begin at the bottom, as is quite common in this Government.
That is communism.
I said that is quite common with this Government. I said that if there is to be retrenchment let us begin at the top.
I am rather anxious to hear what the Minister has to say in this particular regard and I hope he will give some indication that when he does engage in his policy of retrenchment he will not interfere with the pensions given to the old and infirm people in this country, but rather that he will see that there will be a loosening of the machinery in that Department and that those justly entitled to pensions will be able to secure them.
Deputy Anthony is in the great difficulty that he has no way out. The General Election will find one for him. He has told us that he will make representations to the Minister. He is now in a better position to do so. The majority on which the Government depends for its existence, a majority of seventeen with the change over of nine, consists of Deputy Morrissey, Deputy Anthony, Deputy Redmond, Deputy Rice and Deputy Heffernan and the representatives——
The Government majority at the moment does not seem to have anything to do with the Budget.
I suggest those who constitute the majority do matter.
The Deputy will have to keep to the Budget.
It is very valuable indeed that Deputy Anthony has a social system of his own which now is of such a character that the expressions of the leader of the Labour Party are ridiculous. It is now very valuable that Deputy Anthony should have that close contact which will enable him to make those representations with the efficiency which those whom I have named and who have changed over are in a position to do, because they have the power—
On a point of order, I want to say that I have not changed over.
That is not the real point of order.
It is, rather, a point of fact.
A Government is decided by the difference between the members of the two Parties in the division lobby.
The length of the Deputy's speech will be decided by whether he is in order or not.
I think the House understands fairly clearly now the significance of the speech of Deputy Anthony and I think the Minister ought to take it into very serious consideration because when this question comes to be decided in the division lobby, if and when they do lose the support which they have acquired, all the disastrous things which they say are going to occur will occur. The Minister for Finance, Deputy Blythe, regards the discussion on this subject as so important that he departs from the House while it is proceeding. He merely regards the members of this House in discussing this matter as people who are here to talk and, after the formal process of talking about it has been gone through, the Minister for Finance does not want to hear the argument at all. He clears out. Perhaps he has gone to consult those who give him his orders—
The Deputy is not relevant now. The Deputy has not yet arrived at his argument.
He has been interrupted a good deal.
The Deputy is not in order and when not in order the remedy is to sit down. He has not begun to speak on the matter under discussion.
The Minister said that the deficit will be £900,000. The deficit will, unfortunately, be very much more. All you are doing now is simply putting a mustard plaster on a broken leg. The Minister says he does not know whether he can control, or whether anybody else can control, the gold standard. He pays no attention to the fact that he and his Government have gloried in the fact that a sum over seventy times the amount of this emergency Budget has been taken out of the resources of the people of this country without anything being said about it or against it. He says nothing about the fact that his control of the finances of this country, or the control by this House of the finances of this country, is so small that that can occur over-night without anybody being consulted about it. That may seem to him a matter quite irrelevant. To me it does not seem to be a matter of irrelevancy. If he had taken certain precautions in relation to the currency, in relation to the place in which he placed the securities of this State, and in relation to the Banking Bill which was introduced, not merely the amount of money which is to be saved here but one hundred times that amount of money could be saved. But the Minister has no apology whatever to make for that.
The Minister for Agriculture said they were not ashamed of anything. It is time that that Front Bench learned to blush because most certainly they have a good deal to be ashamed of. They are asking us now to impose two taxes, both of which I am going to tell you are taxes which will fall upon the ordinary members of the community and which will interfere with efficiency in the production of wealth in the country. The only thing he has to say in his defence is that he has been considering some economies for three years. How did the Minister consider economies? We have got to look into the efficiency of the way it was done. Has he used any reasonable means, according to the definitions and statements of his own colleagues, to do that or has he not? If he has set up that proper machinery under proper and responsible people which would enable that thing to be done, then he is on the clear. If he has not done that, then to come here and tell us that after three years he is still considering that, makes the thing an absurdity.
What did he do? He set up a Committee under a man whom the President declared to be incompetent to perform either that or any other function. In the most absolute expression of condemnation of the intelligence and efficiency of any man that has ever been uttered in this House, the President of this State and the Head of that Government defined the man here. It was to that man they deputed the business of finding economies. If that is so what claim has the Government for consideration if at this stage they have not these proposals ready? What is required in an investigation of this kind? It is initiative, intelligence, enterprise, honesty, courage and decency. All these things are required. Yet the Minister has the effrontery to tell us that he is still waiting for a proposal after putting the finding of these proposals into the hands of a man whom the President defined as bankrupt of intelligence and as bankrupt of initiative, the two very qualities that were required. The President chose for the purpose of finding efficiency and economies in this country a man whom he defined as bankrupt in everything of use and value to Ireland. And that man, Deputy Heffernan, is an individual and counts in the division lobby, and so does Deputy Anthony.
Mr. Byrne
Hear, Hear!
Where did that solemn voice come from?
The Country Mayo.
I did not think that so small a vessel could hold so large a sound. What is their claim that we should give them this money? It is not that they have been like clockwork mice, running about; it is not that their assininity is the distinguishing factor; it is not any of those expressions which the Minister used to members upon this side of the House and to members of the Labour Benches when they were pretending to ask for their co-operation in this matter. No. Rather is it upon other grounds—they have balanced their Budget. They have never balanced their Budget and they know it. To balance a Budget is to pay your outgoings out of your income and they never have done that on any single occasion since they took charge of this Government. The Minister for Finance on occasions like these will generally walk away and find some other occupation or wait until the last speech before he deals with matters of this kind. I will, however, give some examples. The Minister borrowed money from the people under the name of Savings Certificates. The people were under the impression that he was making the provision necessary for paying the interest and amortising these certificates. He would have to do that out of income if he was balancing his Budget. On cross-examination —I think it was last year—we discovered that he did not make that provision and he had been paying Savings Certificates which were redeemed out of new Savings Certificates coming in and that he was £400,000 in arrear in the provision of his interest. That is what they call balancing their Budget.
There was over a million pounds—I do not know the exact figure, but I will look it up—of land stock in the possession of the Education Department. The Minister for Education is going to sit down under this. They had that when they took over control of the Government. The interest of that ought to be in the possession of the Minister for Education to prevent the necessity for a cut in the salaries of the teachers under this provision. Where is it now? They sold the whole of it and turned it into cash. That is what they call balancing their Budget. There was a fund accumulated by the old C.D. Board during the comparatively prosperous years of the war; money which they had the wisdom and the humanity to keep back during those comparatively prosperous years for the overwhelming necessity which every one of us who knows these districts knew would come in the aftermath of the war. It was money held in trust for the poor people not only of this country but of the whole world. Where is that money? It is gone to balance their Budget.
The Minister came down here one day—he had golden millions in his mind—to tell us of the £700,000 that he was going to get out of the British by converting his token currency. He managed to get hold of some of it, but before he got hold of it he told us it could not be used for Budget purposes. Immediately he did get hold of it he did use it for Budget purposes and he has not been able to get hold of any since. That is what they call balancing the Budget. He used a phrase here, he can look it up when the time comes, to which I would like to draw the attention of the House. He said that the income tax this year is falling, not because the yield of tax has fallen, but because they have exhausted the fund —I think that is the phrase—of pre-Treaty arrears. Five millions of pre-Treaty arrears have been used for balancing the Budget.
I could go through a whole lot of such items. I will find you as much money malversated in this manner as would pay the fourteen millions that Deputy Seán MacEoin says was wasted on his army. That is how they balance their Budget. It is because they have restored law and order that they require this money, that they are entitled to have this money. I believe in painting upon small canvases when one can. I do not think you could find a better canvas than that which was exhibited to us in the Dáil the other day by the Minister for Justice when he was asked whether he was prepared to dismiss a Guard who had been convicted in open court of assault upon a man whose house he went to search under one of these exceptional laws. The Minister said he would do nothing.
The Deputy is completely irrelevant.
I am going to suggest certain economies that they can effect by a change of their whole conduct which at the moment is causing these costs. Surely that is relevant?
No, it is not. The Deputy must keep to finance.
They told us that for nine years they had been in charge. They told us about all this law and order they had restored. They were allowed to go ahead and to say anything they liked upon the subject. They were allowed to deal with annuities and with anything they wished to talk about. What can the ordinary member of the Opposition do when they are allowed to go the whole gamut and he is not allowed to go outside the narrow limits of finance?
The Deputy, of course, knows that the limits of debate on this subject of finance are anything but narrow. If the Deputy reads his own speeches and understands them he will know that he has gone to limits which exceed any limits that any other member of the House has been allowed to go to. If the Deputy has anything to say on the very wide topic that is under consideration to-day, he will be allowed to say it, but he will not be allowed to persist in deliberate irrelevancy. He has been warned on three or four occasions already.
Would I be in order in reading—
The Deputy would not be in order particularly in criticising the Chair.
We will see how we can move along. I want to talk, if I may, to the House for a moment not in a very controversial spirit but in a more technical spirit in relation to this Bill. I think the House is being fooled and I am going to produce as evidence of that, with every possible respect to members of the House, Deputy Good and Deputy O'Connell. Deputy Good wants the net widened. Deputy Davin and Deputy O'Connell—I am only speaking of the spirit and not of their actual words—are prepared to see taxation increased so long as it is taken, as they say, from the people who can best afford it. I am suggesting that these two statements coming from opposite sides of the House and developing, as they always do in a debate of this kind, into acute controversy, are a very good example of two dogs that are set to fight for a bone while some other dog steals it.
There is in every country at present being built up a central organised bureaucratic system which lays down for itself certain requirements which it requires from the community in relation to money and its business is to get that amount of money with the least amount of trouble. The method which is being adopted is to divide taxation into direct and indirect taxation and to persuade one part of the community that the other pays indirect, and the other part of the community that their opposite number pays direct taxation. As a matter of fact, there is no such line of discrimination. All taxation is a portion of the total production of the community which is taken out of the immediate use of those who produce it and is administered by that bureaucratic system. It matters very little indeed in my experience out of which particular source it comes. Take, for instance, the petrol tax. The general idea that people have in envisaging that is of those people in beautiful limousines gliding into sunlit gardens in the autumn sunshine. I believe that is a quotation. As a matter of fact, ninety per cent. of it is used as part of the costs of production, part of the costs either of primary or of secondary production, in the form of transport. If, for instance, you were asked to tax coal, groceries, bread or laundry you would regard that as being in the opposite category. Yet the coal that comes into my house is carried in a petrol lorry; the groceries that come to my house are carried in a petrol lorry; and the laundry and the bread that come into my house are carried in exactly the same way. Any cost in the form of petrol which is put upon the cost of transport comes directly on to these commodities which are supposed to yield indirect taxation. In the same way if you take income tax, the idea of income tax is that that portion of it which is got from investment is got by people who do not work, and the second part is money which is got by people who get it easily and who use it for luxurious expenditure. Anyone who knows anything about ordinary business knows perfectly well that these are absolutely ludicrous ideas.
I have, for instance, in my mind a business in Ireland which has been running successfully for 14 years. It went through its difficulties but it has been, taken over the whole period, running successfully. Not one single penny that has been made in that business is anywhere but in the business and every single penny of income tax that was paid by that particular manufacturing business was taken out of the development of production in that business and the payment of wages. If one of you wander down to the Library and take up a very excellent and somewhat impersonal book "Beveridge on Unemployment," and without worrying about the letterpress just examine the graphs in that book, you will find that a lot of these illusions are deliberately fomented by the machine for the purpose of getting money out of the community. If you would take a graph which is a fairly old graph brought out in a very simple form here, it shows the production over a very considerable period in England of coal, iron, wool, cotton and the rest. That is all going up in a straight line. You have also wages going up in a straight line. You have dividends on securities going up in a straight line. They keep going up a straight line until you come to a point where they begin to turn down and they all turn down together. But before they turn down profits have turned down. The profits were the only thing which had turned down before the general tendency had occurred. Any one who wants to see productive industry flourishing in the country, who wants to see employment in the country, must get out of his head at once that he can afford to take out of industry in the form of taxation, in the form of income tax or anything else, that amount of added capital which is required for its development.
You will find another very disturbing calculation. These are the sort of things which in the ordinary way might very easily be misrepresented. It is better that you should know, because I believe there is simply a game on here to persuade Deputies Good and O'Connell to fight while the Treasury walks off with the money. There is a graph there which shows over a period the rate of wages. There is a graph which shows the price of commodities. There is a graph which shows the rate of unemployment and the variation of that curve. There is a graph which shows the price of wages divided into the price of commodities. That represents real wages. It is a serious matter for those who are sincerely interested in finding a solution of this problem to consider that the curve of unemployment in every single detail followed parallel with the curve of real wages. I want you to think that out.
Deputy O'Connell said that there was possible in this country a social and industrial system which would enable its present population to be fully employed. I believe that. There are only in the Free State a total of three million people. I do believe that with proper organisation that can be done and it has got to be done. If that is difficult, and they say it is difficult, what is the position going to be when every year from this on you are going to add 30,000 people whom you cannot export and must either find work for or keep? What I am suggesting to the House is that the two sides, which are tending to let the monkey get away with the nuts when they are fighting as to which form this taxation should take, should come together and see that no taxation, that no additional amount, is taken from the total production of the State for the purpose of running the State, unless and until it is shown that that money is required and that it can be used better than it has been used up to this. In that connection when we are asked to give them more taxation, when we are asked to take from the fund of production in this State and to give into their keeping that money which might be used in ordinary industry and in our own lives, I think we are entitled to examine the boast which they have repeatedly made in this debate, that for nine years they have been in charge of the Government of the country and commercially and industrially have used these funds for the benefit of the country. If I am wrong now, Deputy Davin ought to be hanged because I am going to follow in his footsteps. "Eight years of reconstructive effort." That is the title of a pamphlet issued by the Cumann na nGaedheal Organisation to the electorate of the Irish Free State, signed by John Marcus O'Sullivan, T.D., Chairman of the Executive Committee of Cumann na nGaedheal. Now we do know why the Minister for Education is here in his place. I am taking now only the credit side of their balance sheet. I am not doing any balancing of the Budget—I am going to take the credit side of their balance sheet only, and to ask whether they are not bankrupt even on their assets alone without facing up to their liabilities. "It is unnecessary." they say, "to recount at length the various measures which the Government has taken for the advantage of the nation"—the twenty-six county nation—"and its people. The process of land division has been accelerated enormously."
I wonder is Deputy Nolan here? Is Deputy Hassett here? "And in many counties brought practically to a conclusion. Ireland's lack of coal has been overcome by the Shannon scheme which has been so successful that an immediate extension of it will be necessary." Probably, and with more money too. "The Government has reorganised the railways." Now I think it is generous of me to give them all this propaganda.
Disorganised the railways.
Will Deputy Davin stay quiet? Remember you are walking in holy places. They are the Lord's anointed. Did they not tell us that God appointed them? Do not be disrespectful ! "The Government has reorganised the railways, extended and improved the roads, instituted an elaborate system of arterial drainage, introduced a flourishing sugar beet industry, provided finance——" this at any rate will be in order "for a variety of housing schemes and has increased employment by the policy of protection for industry." In addition to all these in this eight or nine years of government of which they have boasted continually in their speeches in this debate "it has established the institutions of the State, justice, police and national defence"—these seem to be the institutions of State—"on a basis more economical than is to be found in any other country. It has directed Irish Education towards the re-establishment of national culture based upon the national language and has so reformed it that the economic needs of the people may for the first time receive due attention in their schools and colleges. It has obtained for the Irish Free State international recognition and respect, sent Irish representatives to work for her in foreign countries and received in Dublin envoys of high rank from the Great Powers. In no Department of national life has the Government failed to apply energetic, resourceful and constructive effort. The Opposition on the other hand has been responsible only for a costly civil war, a long period of disorder"—and this is the portion which affects us—"and a variety of malignant and unpatriotic propaganda which has been useless to the people, when not definitely injurious to them." Now if I wanted an example of malignant and unpatriotic propaganda——
And of irrelevancy, the Deputy could take that document.
I am going to quote a Minister. But evidently it is irrelevant even before it is quoted.
The document the Deputy has already quoted is mostly irrelevant to this debate.
These are the things they boasted of. I am going to prove that that "malignant and unpatriotic propaganda" is definitely ad rem. The Minister for Finance said that credit was not a thing that stood by itself. It was not a permanent thing. It was a thing that required to be renewed and that depended upon how it was being kept up. Now I want the House to corelate with that statement the fact that on these benches are the representatives of the second largest Party in the State. At any rate, I think it will not be controverted that they are obviously an alternative Government. What is the effect upon the credit of the State when the Minister for Finance gets up and says that the front bench men of this Party are eagerly anxious for the damaging of the State, that they are trying to damage it and that in analysing its economic position the one thing they are anxious for is that disaster shall come to it. Is that ad rem? Is that unpatriotic and malignant propaganda? On another Budget we asked the Minister whether he meant to found the credit of the State upon all the resources, human and material, of all the people in this country. When we said that to do that was to found the credit of the State upon solid ground upon which it could be built and maintained, what was his answer? His answer was “No,”— the credit was the credit of the Ministry and nothing else. Is that unpatriotic and malignant propaganda? And is that unpatriotic and malignant propaganda which hits at the credit of the State, and makes for expenses such as we are asked here to meet? For nine years they have been in charge of it. It seems like ninety. The Minister for Finance has been in charge of that delicate mechanism— the credit of the State.
Here is some more malignant propaganda. At the end of the last General Election he did not get the majority that he thought he was going to get, and he made publicly a statement that for the loan he was going to get he would have to pay £300,000 more because he did not get that majority. He was going to the fair to buy a cow. He was going to buy money with your money. He went in and said because the people of this country were such fools, because they engaged in malignant and unpatriotic propaganda and did not return him with the majority to which he was entitled, he was going to pay £300,000 more of your money, for the credit of the State was damaged to the extent of £300,000. Is that malignant propaganda? Is that the action of a man who is trying to uphold the credit of the State? Is that the action of a man into whose hands you should hand money unnecessarily? Let us take another item, and this will be relevant. I would like to go through the whole of this list. If there is any item that I leave out it is not because I choose to leave it out. If there is anything in the statement of the assets of Cumann na nGaedheal which any member of Cumann na nGaedheal thinks is sound it is his business to call on me to mention it——
What is the date of the document?
[An Leas-Cheann Comhairle took the Chair.]
Early this year, when they thought they were going to have a general election in June, before the tide came in. "We have provided finance"—these people who want us to give them all this money—"for a variety of housing schemes". Remember, "provided finance". I want you to go back for one moment and get this thing in perspective. There was a by-election in Dublin when one of Deputy Anthony's colleagues, Mr. Rice, was put up in the Cumann na nGaedheal interest. What was the bribe offered to the people of Dublin to elect Vincent Rice? £15,000,000. Elect Vincent Rice and there is £15,000,000 for housing. I think the majority was pulled down from 4,000 to about 207 but they did make Mr. Vincent Rice a Deputy. They have not seen any of that £15,000,000 since. I am going to tell you why. I am going to call into the witness box a witness whose responsibility no member of Cumann na nGaedheal, at any rate, will question. There was a meeting in Cork of all those principally concerned with housing— builders, architects, builders providers, building operatives and the rest—and Deputy Vincent Rice of the £15,000,000 bribe went down with the man who bribed for him, President Cosgrave.
What has this to do with the Bill before the House?
For nine years they have been in charge of this Government and on their record in relation to their work and their achievement they claim that they should have these finances. The particular thing I want to make quite clear——
Let the Deputy make his point on the Bill clear. I am concerned only with the Bill before the House.
The Bill is to provide finance.
If the Deputy will keep to the Bill he will be in order.
On a point of order. An understanding was arrived at on Friday last that we would be at liberty to discuss this Bill with the usual freedom that is permitted in discussing the Budget, and that we would not be confined to the limits of this Bill.
There could not be any understanding which would enable the Deputy to be out of order.
I want to point out that when Ministers spoke on Friday on the Supplementary Budget they wandered over the whole range of their policy and defended the introduction of the Bill asking the people to bear additional burdens on the plea that they had governed properly and that they wanted to continue in the same way.
We must have some regard for the Bill.
In this case I will be particularly ad rem.
I have not heard the Deputy mentioning a word about the Bill yet.
You will hear all about it later.
The Deputy must come to the Bill now.
"We have provided finance for a variety of housing schemes." They went in to that conference and here is what occurred. The President said: "I have not come here to discuss the matter with you, I have come here to tell you that we have provided £2,000,000.""Provided finance for a variety of housing schemes.""We have provided £2,000,000 for housing and I cannot say that we have received any value for that money, and not another penny will be provided under the conditions and in the way in which we have previously "provided finance for a variety of housing schemes." Is that the case upon which these men are entitled to come and ask us to give them more money to administer in one way or another? Let us take another case. They say they have reorganised the railways, that they have extended and improved the roads. They have certainly spent money on them. They have reorganised Great Southern Railways stock down to £9. Is that their boast? Is that the claim to industrial and governmental efficiency on which they ask us to provide more money? But you will say, what have they to do with it? That was an act of God, not the act of God's anointed. They had direct connection with it. They "reorganised and improved the roads." They built a series of velvet highways from every part of Ireland into Dublin. They reorganised the whole road transport system of this country by putting parallel to every railway a competitor. They knocked the bottom out of £22,000,000 worth of Irish capital and they spent five and a half millions in doing it. Is that their claim to industrial efficiency?
Now what are they going to do? This Government to whom we are asked to hand over this money and which is coming here to-morrow or the next day to introduce a Bill to sterilise the very highways which they spent the money on, to prevent them being used for competitive transport, after they had created that competitive transport and allowed the roads to be used to the point of destruction of the existing transport system. These are their assets. I have not taken out anything that I would choose against them. These are the achievements of eight years of reconstructive effort. "Ireland's lack of coal has been overcome by the Shannon scheme, which has been so successful that"—an immediate increase in price will be necessary—I beg pardon—"that an immediate extension"—of the price—"will be necessary." Let us get that point. Remember, I am dealing with you as if you were ordinary shareholders of a limited liability company asked to consider the work of your directorate, asked whether that directorate should be allowed to remain in possession and whether more funds should be given into their hands now that the bank refuses to lend them any more money unless you provide the capital. It was put directly to President Cosgrave—again, I am calling responsible witnesses—"There are two things which are being commonly confused in relation to the Shannon Scheme which have no necessary relation." He asked what were those. "One of them is a network for the whole Free State. The other one is the source of current at Ardnacrusha. You could have a network all over the Free State without a source of supply at Ardnacrusha." The President said "Yes, that is so." Then this proposition was put to the President and put in the presence of a considerable number of Deputies in this House "Given as common ground a network for the whole Free State, we can put down steam stations at the nodal points which will feed that system more cheaply than the Shannon Scheme is feeding it or ever will feed it——"
Surely the Deputy does not think that he can discuss the whole Shannon Scheme on this Bill.
I am dealing with the finance of it. The answer was "Yes, that is so."
I want to hear the Deputy on the Bill and not on the Shannon Scheme.
Let me quote somebody who most certainly will be reputable in this debate—"Our policy so far as law and order is concerned, has always been sound." That is the Minister for Agriculture, the bold and unbiddable child. (column 1163). "Deputies opposite will realise that now. We are going to see to-day, whether we are the next Government or not, that when we leave office you will have law, decency and civilisation in this country and that in consequence of balancing the Budget we will be in a sound financial position. We have succeeded in doing both. We have succeeded in establishing law and order. We have succeeded now in righting the financial position with less recourse to taxation than any other European country." He has balanced his Budget and has put us in a sound financial position! His sound financial position is represented by the ruin of the Irish railroads and by the spending of Irish money to put a competitive system alongside. It is represented by spending upon the Shannon Scheme what I estimate to be a total amount of £17,600,000 and what Deputy MacEntee estimates, at the lowest figure, as £14,800,000. We have the admission of those people who put that finance on a sound basis that they did that by spending that money on a system which provided electricity dearer than an alternative system and dearer than it was before. Is that the ground on which they should have more money? Is that the ground on which the directors of this limited liability company, coming to the shareholders, would say: "You must provide us with more capital." Or is it a ground on which these shareholders should say: "You get out"?
Take some more of their finance— what they have done to produce that sound financial position which requires the shareholders to provide more capital because the banks will not give them more money unless the shareholders put up more capital. I do not think I need say anything about sugar beet. Is there any member of the Dáil who thinks that their treatment of the sugar beet scheme has been the treatment of sound financiers, has been the treatment of men into whose hands other people's money ought to be put? I do not believe there is. They have "organised and systematised the agricultural markets." Another of their financial schemes! Another of the methods of putting the country in "a sound financial position"!
We will just take one single admission. It covers £173,000—quite a nice little item to put into the supplementary Budget. The heaven-sent Minister for Agriculture bought a collection of creameries for about £600,000. He said the farmers would buy them from him at the price he paid for them. You know now that the value of anything in Ireland is what the Government is prepared to pay for it. Some of the farmers did take the creameries at one price or another, and some of the debates we have had will show you what sort of Dutch auction it was worked on. In respect of those who did not take the creameries out of the £600,000 pool the estimate of the Minister for Agriculture, as a financier and as a business man, of the value of the things he bought has proved to be in this year £163,000 wrong. I do not think we can afford the Minister for Agriculture at that price. But that was not all. Not only did he take over the business of running the whole, big industry from the hands of those who knew it, but he decided to take out of the hands of those who were accustomed to it the whole of the distributive side of that industry. Here, again, some farmers did come in and some farmers stayed out. Some creameries came in and some creameries stayed out. The people who stayed out might be regarded as having a prejudiced opinion of the financial ability of the Minister for Agriculture. So we will only take those who came in—his friends. They came in and formed the I.A.C. in order to teach the people how to sell butter. What happened his own friends? The people whom he did bring in smashed the I.A.C. in his own hands. It went publicly bankrupt.
The Deputy will have to come to the Bill now or discontinue his speech.
There was public money spent on this scheme.
And we are paying it, even though the Leas-Cheann Comhairle does not know that.
The Leas-Cheann Comhairle knows his business.
Surely Deputies can criticise public finance, and how these people have spent this money when the tax payers are being bled for more?
They can, but they must be in order in doing so. Deputy Flinn has not said one word about this Bill. The Deputy must come to the Bill.
I should like to refer the Leas-Cheann Comhairle to the statement made here by the Vice-President on Friday last—that we would be allowed the fullest liberty on this Bill to discuss the whole policy of the Government.
Does the Deputy suggest that he has not been allowed the fullest liberty? I shall not allow liberty to develop into licence.
There is a whole column and a half by the Minister for Industry and Commerce on the annuities: on the lawyers' opinion on the annuities, pointing out the case that could be put up for paying and not paying the annuities. Will I not be allowed to go on that line?
I listened to all that debate on Friday. I would now like to hear the Deputy on the Bill. We have not heard him on it yet.
There will be more disorder if the Leas-Cheann Comhairle does not mend his ways.
On a point of order. Is the Leas-Cheann Comhairle correct in referring to this matter as a debate on the Bill? Would it not be more correct to say that what we are now debating is an additional Budget? It has been referred to as a Budget by the Minister himself.
If the Leas-Cheann Comhairle were to keep Deputies to the Bill, Deputy Flinn would not have been speaking for the last fifty minutes.
Might I refer the Leas-Cheann Comhairle to the statement made on Friday last by the Vice-President? The reference will be found in column 1169 of the Official Debates. The Minister said "After going to the printers it,"—meaning the Bill—"will be circulated to-morrow and we should take the Second Stage of that on Wednesday next, when there should be an unlimited discussion on the subject, finishing the Bill by 2 o'clock on Friday next."
The Bill?
Not the Bill, but on the whole subject dealing with the supplementary Budget, including the question of retrenchment and possible economies, and of course Ministerial extravagance.
I will now hear Deputy Flinn on the Bill.
They claim that they have put the country in a sound financial position. One of the things that they have done in relation to that, in order to put the country in a sound financial position, is that they have restored law and order and that they have ensured when they leave office—that is rather useful—when they leave office—that law, decency and civilisation will come into the country. I think that is quite clear. In their eight years of reconstructive efforts they say the same thing. They say that they have established the institutions of justice, police and national defence—I ask Deputies to listen to this—on a basis more economical than any other country in the world. Now if there is anything that I am entitled to discuss facing this board of directors who are asking for more money to run this company it is the question: whether or not this limited company has established these three services, justice, police and national defence on a basis that is more economical than is to be found in any other country. If they have not done that, then they are not entitled to the money. That must be perfectly clear. If we are to decide whether or not they are entitled to the money we must be in a position to examine whether or not they have established justice, police and national defence upon an economic basis.
Now let us get hold of the evidence again. All that we are asked for in this Bill is £450,000. There is a Deputy on the benches opposite—he is not sitting here now, naturally he would not and he is very wise to stay away from a discussion of this kind— who, in spite of whatever explanations he gives in the newspapers of how he did it over his own signature, has stated that their method of putting national defence upon an economical basis was to spend fourteen millions of money, every single penny of which was wasted from the point of view of national defence. Is not that so? Is Deputy Seán MacEoin a prejudiced witness against the efficiency of this administration? Did he know what he was talking about? Either he is prejudiced or he is ignorant or saying something that is not true. If he was so ignorant of what was going on inside national defence and that that statement was not true, then why did they spend money in keeping him there? I take it that he did know, and that he is offering first hand evidence and first hand testimony when he says that as far as national defence is concerned their contribution towards putting the country into a sound financial position has been to waste the money that was provided for that purpose.
But if Deputy Seán Mac Eoin was not good enough as a witness we can get one of the inspired prophets, the Minister for Agriculture. Having heard the Minister for Defence describe in detail that Army here, an Army costing £1,500,000 per annum, as a technical, efficient body, the Minister for Agriculture got up beside him and told him that as an army it was not worth a damn. Fourteen million pounds for an army that was not worth a damn! Is that the foundation on which these people have built up the financial efficiency and the soundness of this State? But there is worse than that, and in my opinion it is altogether more serious than the fourteen million pounds that were wasted. That is gone. According to the Minister for Finance himself, those fourteen million pounds have been spent not in creating an army for national defence but for the purpose of creating in this country an authority which is suzerain over the people of this country, a military authority which overrides the civil power and which has the right to say to the electorate of this country when they return another Government at the General Election that unless they are good boys, according to the definition of the men who wasted those fourteen million pounds, that that Government sent back by the people will not be allowed to function.
Is that the basis on which they say that as a directorate they are entitled to get more money from the people? Is it because every first-class railway carriage—while it lasted it did some good to the railways—was full of detectives for the last week, that money is spent on justice? What have been the expenses up to the present of the Public Danger Act which they passed under the closure, the closure for which Deputy Good voted? What has been the cost of that Act in relation to this amount? How much of this £450,000 that we are asked for now is going to justice of that kind? We have had cases in the last few days of men of absolutely unexceptionable reputation, men perfectly clear of any possible suspicion in relation to anything of the kind that this Bill is supposed to be for, who have been raided, examined and held up. Is that the sort of expenditure and the sort of work that is going to make for economy in justice? Yet we are told that justice, police and national defence are on a more economical basis here than in any country in the world. Yes, economical of justice. Here you had a Minister getting up in this House and saying, in relation to an assault proved in court, that he would do nothing to the Civic Guard who did it, though that assault was committed by him when he was actually acting as a functionary of the Minister for Justice. When the Minister was asked what he would do in relation to what must have been perjury in the defence in that case he told you: "I will do nothing." Is that to be justice upon an economical basis? The Army which Minister Hogan says is merely an armed adjunct of the C.I.D. is a very breeding ground of waste of money, a breeding ground of disorder and of discontent in this country. These are the things which will have to be met by this Budget unless they are met by getting rid of the people who are responsible for the policy which has caused all that waste of money.
I do not care what particular part of the extraordinary screed which you take, it is the same story. I am satisfied that one statement is true in this screed. "The Government if returned to power will not stand still. It will apply to all the problems of the coming time the same honesty, the same devotion and the same single-minded attention to the people's needs that it has displayed in the past." It will in the administration of your £450,000, or your £900,000 or the £1,500,000 which Deputy MacEntee estimates is necessary to balance this Budget, apply the same honesty that the Minister for Justice showed in relation to that criminal Civic Guard, the same efficiency which the Minister for Industry and Commerce has shown in relation to the sugar beet industry, the same fairness and honesty which the Minister for Industry and Commerce has shown in relation to the Shannon Scheme, the same regard for the reputation and credit of this country as is shown by Deputy Blythe, Minister for Finance, when he refused to get the support of the people behind his credit and put it on the solid foundation of himself.
If I were in reality, as I am in spirit, at a shareholders' meeting of the Irish Free State, and if directors with a record such as those people have, of criminal extravagance, of reckless disregard of obligations, of utter darkness of understanding of the problems which they have to deal with, were to ask for more capital to run this State, I would say, "Get out; let somebody else get in charge of it who has some elementary knowledge of business." Every single thing they have touched which required business knowledge they have messed. They have had opportunities. Men of their own side, good men in all parts of politics in Ireland, who had knowledge of the industrial and commercial position of this country, have offered to help and they refused that help. Lillis, the old general manager of the Munster and Leinster Bank, was the one banker we had in Ireland. He came and offered help. He came in order to tell them something and he came back to Cork and told us that they had brains to sell. It is the same in relation to every other man who has had any contact with industry, any knowledge of production, any knowledge of the realities of life, who has gone to help them. They knew too much; they did not want any help. Here across the floor of the House in relation to insurance when members on this side offered to co-operate with the Minister in finding a solution he said they knew all about it. They did not want any help from anybody. It is the crass unteachable ignorance of these people which makes them utterly unfitted to be in charge of a hen farm, let alone a country, the biggest collection of duds that ever a country was cursed with, and the sooner they are thrown out the better.
Judging by the remarks of the Minister for Finance on Friday, it appears that the Government consider that all criticism of this proposal is rendered nugatory by the fact that the individuals concerned will not be any worse off, after the proposals have been put into effect, than corresponding individuals in Great Britain. That may be all right so far as individuals are concerned, but from the point of view of national needs and national requirements, it is not an argument that is a very imposing one. On former occasions of a similar kind the Minister told us that a low income tax in this country would have the effect of bringing much foreign capital into the country and that considerable advantages would accrue as a result. It is to be observed that he made no reference to that question in his speech on Friday. Are we to infer that he has now found that it was not having that effect, or was it that he considered that a reference to that subject would be inappropriate, following the introduction of the Constitution (Amendment) Act?
It is, however, in connection with the proposals for an increase in the tax on petrol that I would like to ask for more information. I think the Minister owed a little more explanation to the House in connection with that tax than was given when he was introducing it. I think he owed a little more apologia than the incorrect statement that the Road Fund has been abolished in Great Britain; so that there is a comparative advantage here to motorists in that the road tax is being utilised for road work, whereas it will not be so utilised in Great Britain, except at the discretion of the Government. I know that the May Committee, a Committee presided over by a gentleman called May, recommended the abolition of the Road Fund, but I think the Minister is not correct in stating that that recommendation has been given effect to. However, even if it were it would hardly counter another argument provided by the Minister himself against the proposed tax. If Irish motorists have still the advantage that the Minister refers to, it would not balance the argument the Minister gave at the same time when he said that he expected a reduction in the yield from the motor vehicles duty of £80,000 at the end of the financial year. Evidently that reduction indicates that a slump in motoring has already begun.
The question then arises does the Government wish to encourage that slump, or have they changed their minds in regard to the use of motor vehicles in this country, since the Minister made his Budget statement last April? In that statement the Minister referred with satisfaction, in fact it might be called exultation, to the fact that the revenue from the Motor Vehicle Duties was increasing, and was likely to increase. He now states that there is going to be a reduction in the estimated yield at the end of the financial year, and at the same time he introduced a tax that he knows must cause a further reduction in the use of motor vehicles. Are we to infer that the Government have made up their minds that the use of motor vehicles in this country has gone too far, and that they must now take strong measures to discourage it? Is the proposal to be considered as part of the transport policy of the Government, as the first sign of a transport policy which will be followed later by other measures that will even have more effect in keeping motor vehicles off the road? The Minister himself knows that at this season of the year a great many motorists are in doubt as to whether they will license their cars for the winter months, or not. Even if there was no suggestion of a tax, no question of an increased petrol tax, numbers of people are always in doubt as to whether they will take out a licence for the winter months or not. In some cases, the decision is not to take out licences. A great many, after thinking it over, decide that it is worth while to keep them licensed. He must know that one effect of this tax will be that a large number of these people will decide that in view of the high tax it is not worth while, and they will put their cars in store until next April thereby causing —I will not say a substantial—but certainly an appreciable decrease in employment, a decrease in the employment of chauffeurs, mechanics, washers, and other people concerned in the motor business. Again, how is this proposed tax consistent with the Government's constant claim that their aim with regard to agricultural policy is to keep down farmers' costs? Neither the Minister for Finance nor any other Minister will deny that in many parts of the country, in North Cork, West Cork, practically the whole of Wicklow, Sligo, Cavan and Leitrim, farmers are dependent for the supply of their consumption goods as well as for the export of their produce on motor vehicles.
How are we to reconcile the plea that the Government policy is to keep down costs to farmers with this tax which will inevitably increase the cost of delivery and of the export of such goods? How are we to reconcile the tax with the Government's objection to tariffs? The objection has been repeated over and over again to tariffs on necessaries of life that they will make it too difficult for farmers to produce and impossible for them to compete in the export markets. There have been so many tears shed over the boot tariff, for instance, and over its terrible effect on farmers and their families that some Deputies have, I understand, thought of starting a boot fund to relieve the awful situation. Yet here is a proposal handed to us without any explanation or analysis of its effect on farming or on economics which will probably have more effect on farmers' costs than a further 10 per cent. increase in the tariff on boots. I think we are entitled to some explanation on this question, and I am surprised that the Minister did not offer such explanation when he was proposing the tax.
With regard to the effect on bus traffic the only thing I would say is that it seems a very wrong thing on the part of any Government, having looked on at such services being introduced, they should now without any notice propose a tax that will destroy the property of a number of poor men who, finding the field for employment was limited, decided to endeavour to earn their living by giving a service to the community, and invested their all or even more than their all—very often incurring substantial liabilities with regard to the future—in order to start bus services. It seems a very cruel thing on the part of any Government that without any notice, without any discussion with these people as to how far it will affect them, they propose a tax that will inevitably destroy a number of these services and drive a great many of these people out of business. In most countries such men are regarded as the backbone of the country, men of enterprise, men of ambition, men who undertake to give a service to the community. In a country like this, where the Government is apparently aiming at a Distributist State, one would think that such people would be the special care of the Government. It does not seem from this proposal of the Minister that any special care is extended to them or that they are even worthy of consideration at all. I am not pleading for any special consideration for the motor business, for although I earn my living from it I have no responsibility towards it here, and I am prepared to discuss any question in connection with it at least as objectively and as free from prejudice as any other Deputy in the House.
I do say, however, in connection with a tax which is being increased by the present proposals, that it represents such a very big tax in the gross, and is being increased within such a short period that the Government owe to it the fullest possible and the most careful examination that they can give.
I consider also that this tax is unnecessary. I am not speaking now from the point of view of economy or anything of that kind, but I am proposing that if the Government were to review the whole field of motoring and if they were to examine the imports required in consequence of the use of motor vehicles in this country, they would find there such opportunities for substituting native production for imported goods that there would be no need for this tax, that the employment that could be given by such a change would be quite sufficient to secure from ordinary revenue the amount expected from this petrol tax.
It is a surprise to many people that the Government having been in existence so long has been content to see the whole expenditure required in connection with that service depending entirely on imported goods, amounting I think to something like £4,000,000 a year. It is a very lucky thing for motorists that farmers have never fully realised the havoc wrought to agriculture by the introduction of motor vehicles; and it is even luckier for them and the urban community that farmers have never realised that these big imports of £4,000,000 are being paid for by the export of agricultural goods—that that vast amount of their labour is required to purchase motor requisities which are chiefly for the use of the urban community. Looking at it now from the point of view of what the country is faced with, I suggest that if the Government were to review that field and were to take each item of the expenditure that is involved, to analyse it and see whether there could not be substituted home production for imported materials, they would find, at least, sufficient opportunity there for such additional employment as would inevitably get from existing sources the increased revenue and more than the increased revenue that is involved in this new tax of 4d. additional on petrol.
I do not mean to suggest that petrol can be got from granite, seaweed or anything of that kind; but if you take, for instance, the item of lubricating oil, amounting, I think, to 2½ million gallons in the year, we have already the beginning of an opportunity in this country for keeping some of that money for Irish enterprise. There is one refinery, I believe, in Dublin, which is able to carry on in spite of all competition and to make the refining of oil a paying proposition. We should be told whether the Government has ever inquired into that industry and found there the possibility of capturing a little of the import trade that I speak of. We know that the Government turned down the application of the coach builders for an increased tariff on their goods. In connection with this tax, would it not occur to them—since they have never given an explanation as to their reasons for that decision, since they have never stated whether they found the report of the Tariff Commission was so convincing that they were not prepared to consider the question further—that there is now an opportunity for saying to the motoring community that if they are prepared to use Irish-made bodies on their vehicles they will be allowed a rebate of at least part of the tax or, if you like, the whole of the tax? If the Government is convinced that coach-building cannot be done economically, and if they are at the same time satisfied, as I suggested a while ago, that the use of motor vehicles has to be discouraged in this country, then the opportunity of achieving two ends by the same method is available, if they make that offer to motorists. At all events, that idea would put the coach builders' claim to the test—their claim that they are in a position to build bodies on competitive terms and that all they want is the protection that they asked for from the Tariff Commission.
Again, in connection with such things as motor parts, radiators, hoods and so on, there are already small manufacturing industries in the country, but they are timid and experimental at the moment. I think it would not be stretching State interference too far if such industries are examined with a view to seeing whether they cannot be developed so that the whole of the trade required in these goods could be an Irish trade. The Government cannot be satisfied that some special departure is not required in connection with the situation that faces us at the moment. No one can be called a pessimist who says that the immediate outlook for agriculture is far from promising. It is certain, too, that no improvement in that respect can be hoped for in the near future. According to most observers the outlook for any country depending entirely on agriculture is by no means a healthy one unless they take the opportunity to increase their industrial activities, and find employment for their people in other directions than the direction of food production. A very great authority has within the past few weeks made this statement:
"As a consequence of the ‘factory farm' thousands of farmers will be driven off their present holdings, and alternative sources of occupation must be found for them. In the food producing countries, the trend will therefore be to manufacture locally much that used to be imported—if necessary under the stimulus of high tariff walls. Otherwise there will be grave local agrarian unemployment, and consequently grave political instability."
For those who keep on saying parrot-like that Ireland can never be an industrial country, that her future is entirely an agricultural one, I quote this further statement from the same source:
"The problem of to-day is no longer the high cost of carriage, but the increasing degree to which science is making the whole world independent of local circumstances in the production of necessaries, coupled with an increasing determination on the part of the agricultural peoples to emancipate themselves from the dominance of the advanced, industrialised States."
I think that, to anybody who has any knowledge of how things are going in the world, is a fair summing up of the existing situation, and I suggest it has a special application to the position in this country.
I have tried to explain my reasons for thinking that the tax on petrol is going to cause very serious unemployment in the motoring business, which is now one of the largest employing businesses that there is in the country. It is my deliberate opinion that this tax will lead to unemployment in the garages of the country, amongst drivers and other persons concerned. I believe also it will mean a fatal blow to a number of people engaged in the bus business, a number of people who have quite genuinely undertaken to do a service to the community and at the same time to earn a living for themselves. I believe also that it will have a certain effect in increasing the farming costs, and even if it has not a very big effect it will have such an effect as will inevitably make the lot of the farmer a harder one than it is at present, and as we all know there is no room for any increase in the burden that rests on his shoulders. In face of these circumstances I would appeal to the Minister that he would reconsider this tax before it is finally passed through the Dáil. I would particularly appeal to him to look to the other fields I have mentioned, to look to the possibility of finding revenue from greater employment which may be provided by supplying more of the requisites connected with motoring from within this country. I believe if he does that he will find that he will get a great deal of sympathy and cooperation in his endeavours and that the result will be much more satisfactory to him and to the country than if he proceeded with the proposal that is before us at the moment.
I desire to call the attention of the Minister for Finance to one or two points in our income-tax law which are not novel but which have an added importance at present in view both of the increase of tax which is proposed under this Bill and the general circumstances with which most of us are only too painfully familiar. Before I come to the specific points I wish to put to the Minister I will have to lay down two or three general propositions in which I think there will be agreement. In the first place, I think the Minister and everyone else will agree, having regard to the tone of the Press and so on last week or so, that the income-tax payer is preparing to bear the added burden laid upon him by the Bill with considerable good humour.
The second proposition is that in this particular year 1931-32 the income-tax-payer is very hard hit. Most of us have personal experience of that. There are very few people, I imagine, whose incomes are derived in any degree from stocks or shares or securities whose incomes are not less this year than they were last year. The third proposition I lay down is this: That anything which encourages people to bring money into this country is to the good, and that anything which discourages them from bringing money into this country is to the bad.
The fourth proposition is this, that when we are increasing the burdens on any particular class of taxpayer, we have to be more than usually careful not to do, if we can possibly avoid it, any avoidable injustice. I want to direct attention more particularly to one specific point. I said it was not novel, but in order to understand it we have to go back to Section 11 of the Finance Act of 1929. I will not read it to the House because I do not think it would enlighten Deputies very much. In fact, I would be prepared to offer a small prize to anyone who, at the first reading of it, would tell me what it means. I except certain people; certain people I must bar. I would bar the Minister for Finance and I would certainly bar Deputy Jasper Wolfe because I think he knows too much about it, and possibly I might bar one or two members of the legal profession. With those exceptions I am prepared to offer a prize to anybody who will lay his hand on his heart and, having read the section, will tell me what it means.
Does that include the Revenue Commissioners?
No, only members of this House.
The Revenue Commissioners do not understand it either.
The section has to be taken in connection with the First Schedule of the Act, and the general effect of it is to change the basis of assessment on British dividends, and on income generally—shares and securities of one kind or another arising outside Saorstát Eireann and assessed under Schedule D—from the year in which the income is received to the previous year. I think that will be found to be correct. I hope I will earn the gratitude of Deputies if I am correct in stating it clearly, because the Act does not do so. Let us apply that to the present year. I suppose there can be hardly anybody whose income, derived from securities or stocks or shares in Great Britain or elsewhere, has not seriously fallen in the present year. No doubt quite a fair answer to this could be made by suggesting that it might have been the other way about. If this, in fact, had been a year of great prosperity, and the income received by the taxpayer had been increased instead of being diminished, then in that case the taxpayer would have profited by the change. That would, I think, have been a perfectly proper and natural answer to make if we were not dealing with so exceptional a year as the present one.
That the change might bring about quite considerable hardship was obviously recognised, because in the Finance Act of 1930 we find a provision—Section 4—which reads as follows:
If any person, who was assessed and charged to tax for the year ending on the 5th day of April, 1930, in respect of income tax arising or accruing from the securities outside Saorstát Eireann or from stocks, shares or rents in Great Britain or Northern Ireland, proves to the satisfaction of the Revenue Commissioners in the manner provided by this section, that the aggregate amount of the income so assessed was greater by more than twenty per cent. than the aggregate amount of the income actually arising or accruing to him for the year ending on the 5th day of April, 1931, from securities outside Saorstát Eireann and from stocks, shares or rents in Great Britain or Northern Ireland,
then certain relief, as measured in a rather complicated way in the remaining part of the section, is to be allowed. I want to remind the House that no such section is to be found in the Finance Act of the present year and, therefore, as I apprehend—if I am wrong I would be delighted to be found wrong—no such provision for relief is or will be open to the taxpayer in respect of income received in the present year, even though it has decreased by more than twenty per cent., as compared with the income of last year.
That is bad enough, but it is not the whole of it. It is generally said of income tax that it is the fairest of all possible taxes because a man only pays upon what he receives. I wish that that proposition were wholly true. I am afraid it is not. I want the Minister to consider this case, for example. At the beginning of this year a certain person well known to me—I will not reveal his name—sold some of his British War Loan stock and re-invested the money in the prior charges of a certain Irish railway. It was an act of patriotism which I think should receive approval from the hearts if not the heads of Deputies here. What is going to be the result? Let us say he sold £1,000 of War Loan and he re-invested it in the Great Southern Railways. What is going to happen? Obviously he is no longer getting the £50 he was getting from the war loan. Instead of that he is getting a certain sum from the debenture stock of the Great Southern Railways. That money will, of course, be liable to deduction at source of Saorstát Eireann tax. That is quite right and there is no quarrel at all with that. But what about the stock he has not got? What about the War Loan he sold? He received £50 in respect of it and, as I read the section, he will be liable to assessment on that £50 in addition to the tax which he pays by way of deduction at source on the money he has re-invested in the debenture stock of the Great Southern Railways. I shall be delighted if I am proved wrong.
It may be some relief is allowed, but I confess I cannot find it in the Bill. There is no provision here such as was made in the Finance Act of last year. If there is any right on the part of the taxpayer to decline to pay the tax on the money he is not going to receive, I shall be glad to hear of it, but I do not think there can because if, without any special provision, it were possible for him to escape paying both on the money he has got and on the money he has not got—both on the Irish stock he has bought and on the English stock which he has sold—then I conceive there would have been no point in the provision to which I have called attention, Section 4 of the Finance Act of 1930. It was thought necessary last year and I feel sure if the thing were to apply to this year a similar provision would also be inserted. I will call the Minister's attention to that. If I am right it is clearly contrary to public policy.
I am sure everybody would wish that people as far as possible should invest in this country. It seems obvious that there should be a desire to encourage people to bring their money from across the Channel and from foreign countries in order to support Irish industry in one form or another. If the matter stands in the position I think it does stand in, then I see no way out of it for the individual of whom I have spoken except to resell his interests here and re-invest the money in England. In that case he will be getting a larger sum from England in the following year, because he will be assessed on the smaller amount which he received this year. It seems to me to be an extraordinary state of affairs. If I am wrong I shall be delighted to be put right. I have made such inquiries as I could from a number of people who are interested in this matter and they assure me that what I have tried to state is actually the law as it stands. This is a matter which very clearly deserves attention.
If the Minister has decided that it is better to meet the Budget deficit by extra taxation rather than by creating what might be called a hanging gale, I think he has, perhaps, acted wisely in imposing an extra tax on income tax and petrol. Income tax, as Deputy Law says, is really taxation which is borne by the people best fitted to bear taxation. My reason for getting up is that on last Friday the Minister told us that the decrease in the Budget estimate of the revenue on spirits was £80,000 and that that deficit might be attributed to decreased consumption. Ministers for Finance in the past have usually regarded the spirit tax as a sort of goose that laid the golden eggs. I should like to ask the Minister whether he does not fear that by this heavy taxation which he maintains on spirits he is not likely to kill that goose, and if he will consider whether reduced taxation on spirits with some contribution by the distilleries in the way of reduced strength of whiskey, might not help to induce more consumption and a bigger revenue without leading to more alcoholic excess.
On one occasion I described the Minister for Finance as the nation's housekeeper, and suggested that perhaps he was housekeeping on too lavish a scale. I still think we might look at it from that point of view. Money has been poured into the Shannon Scheme. I hope it will be reproductive, but from the way things are going at present, it is very hard to see when the reproductive period will be reached. Again a few months ago we voted £750,000 for de-rating. I do not believe that the money given in that way pleases anyone, and I am afraid it will not be reproductive. I believe it was only voted for one year, but the precedent has been established and we will probably be asked next year to vote a similar amount or possibly more. I think that if the Minister looked into the question of spirits he might find that if he was a little more lenient towards the distilling interests it would not be a very bad thing for the State.
I do not think there is any use in appealing to the Minister on any particular item, or on any particular grounds in the hope that anything will result in the shape of consideration of the appeal or criticism, no matter how well founded it may be, which prompted it. If it were possible to think that any member of the Executive Council was anxious to educate, if they like to call it such, the members of the Opposition and give them information to show that they were wrong in the angle from which they view things, one might be able to deal with matters on a different basis. But as far as I can see, every question, no matter how vital it may appear to the person putting it, or to other Deputies, or to the community, is met by hedging, or by an answer which does not lead to any direct information. To-day I suggested that I would raise a matter on the Adjournment, which I intend to do, and the Minister for Industry and Commerce indicated that he will not be present. We will therefore have to speak for the purpose of putting on record the views that we hold in the hope that at some future time some people reading this particular debate will come to the conclusion that we were right, that the members of the Executive Council were wrong, and that the members of the Government Party must have been extremely foolish in tolerating such leadership for such a long time and at such terrible cost to the community.
I venture to suggest that the Minister could not answer three or four simple questions which I can put to him now. He talks of the credit of the nation, and of the wealth of the nation. I venture to say that the Minister has not the foggiest idea of them, that he could not even give a guess as to what is the credit of the nation which would be within £10,000,000 of it, nor could he give a figure within, perhaps, £50,000,000 as to what is ordinarily known as the wealth of the nation, including productive capacity. He has not the foggiest idea on these matters. He does not intend to educate me on these points, nor has he any hope of ever being able to answer the question. He just treats the whole thing with contempt, and looks upon State finance as a national housekeeper, as Deputy Murphy suggested—certain revenue and certain expenditure. Expenditure goes up when prices go up and he must get more money. Prices come down, and he can afford to cut off a bit, if such a thing were possible.
Deputy Law referred to the possibility of people bringing in money from outside to invest in Irish industries and securities, but the one thing that he forgot to lay stress upon, whether by accident or design—I shall say that possibly he never thought of it—is that you will never get money in this country from outsiders, or from the people in this country who have money until they are guaranteed some security as regards stability, in the sense of the activities of the Executive Council. There is no use in any man hoping for stability when he does not know what move is going to be made by the Executive Council to find extra money to bolster up expenditure which was not necessary, and which was criticised when it started. As Deputy Murphy said when he referred to the Shannon Scheme, we do not know when, if ever, that scheme is going to prove reproductive from the point of view of showing a return in the shape of profits.
I asked the Minister some years ago what was his outlook and attitude with regard to the situation which arose owing to the arrangement arrived at between this country and England with regard to double-income tax, and I pointed out that I thought it was a grievous mistake to allow multiple firms to open up business here, because of the fact that they were registered outside the country and would be free from income tax here; that their income tax would be collectable on the other side and this country could go without. I admitted that there was a certain exchange, but I pointed out that the exchange would lead to a falling off in the return to the Exchequer here and an ever-increasing return to the Exchequer of another country. Anybody who keeps his eyes open and examines what is happening in the City of Dublin and some of the bigger towns will see that there is an ever-increasing number of branch shops of multiple concerns whose headquarters are not here and out of whose profits this country does not reap any benefit in the shape of income tax. I have not got the exact figures because they vary from year to year, but at the time I asked the question two years ago I pointed out that the multiple shopkeepers, by virtue of the trend of conditions here, would be on the increase, that the Irish shopkeepers would be on the decrease and that ultimately the State would lose in respect of revenue to the Exchequer.
I want at this stage to deal with one particular tax. Deputy Moore referred to the 4d. tax on petrol. I do not know whether the Minister or his staff ever spent any time in investigating the conditions that would arise amongst those on whom the tax would fall heaviest. During the week-end I made it my business to interview several bus owners or men interested in bus companies plying in the City of Dublin or from Dublin to other parts of the country. One of these men gave me a copy of his balance sheet. He authorised me to say that the figures are open to confirmation or analysis by any member of the Government or any civil servant. These figures come from a man who attended a conference presided over by the Minister for Finance when the last tax on petrol was being imposed.
That was the very man who was pointed out by the rest of the bus owners as being a fool because he admitted at that conference that a certain tax was possible, and that the bus business could still be carried on. This very man who was looked upon as the Minister's pet, is anxious now that the Minister should investigate his figures and see what will happen to him. That man owns four buses. His average gross income from those four buses amounts every week to £88 approximately. His gross expenditure, that is wages and so forth per week, amounts to £88 7s., that is including the present new tax, so that if he is to carry on his business he will have to run it for the purpose of collecting £96 per annum in the way of tax, and he will have the privilege of losing 7/- per week for doing so. He states that not only will it not be possible for him to carry on but that the nine men whom he employs will have to be paid off. The capital invested in these four buses—they are now paid for—will be a complete loss.
Will the Deputy tell us what his consumption of petrol is?
I will give the figures. These nine men earn a wage amounting to £30 per week. He has no conductors, they are conductor-drivers— one mechanic and eight drivers. The road tax which was £2 10s. now amounts to £6 10s. His garage and lighting expenditure comes to £2 12s. per week; tools and equipment 10/-; unemployment health insurance £1. He pays bus insurance, to keep him covered against third party risk, and he carries himself a certain risk under a certain amount to get the insurance cheaper. And the insurance amounts to £9 a week. Sundries such as oil and grease amount to £2 15s. per week. I do not know what he pays for his petrol, 7d. or 8d. or 9d. a gallon, but the amount of his petrol consumption less tax is £9 10s. per week. His first 4d. tax amounts to £5 10s. per week, so that if you divide 4d. into £5 10s. you will get the amount of his consumption in petrol. The additional 4d. means another £5 10s., making a petrol bill including taxation of £20 10s. Renewals, re-painting and repairing £9 10s.; tyres £2 10s.; depreciation on four buses he puts at £3 per week, which I think must be agreed is modest. His receipts he puts at £22 per bus, which when multiplied by four amounts to £88.
This man says he is prepared to stand over these figures and submit them to anybody who cares to examine them. As a matter of fact, he is prepared to submit, if necessary, a certified statement of accounts from a reputable firm of auditors. I had these figures examined by a competitive bus owner and he told me that if anything the figures put down as expenditure were modest. What the Minister for Finance expects to collect from this man who has to pay £936 per year is more than I can understand. He will have to go out of business altogether, and the Minister's estimated receipts by way of tax are certainly going to be lost.
I spoke to another owner. He has a big fleet of buses and gives a considerable amount of employment. I must say that this man was certainly rather excited, but upset, and he made it clear to me that he could not possibly carry on because of the difference between being able to carry on up to now would be eaten up by the 4d. tax. Deputies may say: Why do not these bus proprietors raise the fares? To that question they told me that if they raised their prices up even by one halfpenny on the existing fares they would not get passengers. The Minister may be trying to balance his Budget on figures and he may estimate that on what has been received in the shape of taxation in the last nine months and that he is going to get a certain addition, but I want to tell him, as I have told him when he said that he only wanted to balance his Budget, that he has never balanced his Budget, and that he is not balancing it now. The Minister while talking of the figures on the income side did not lay much stress upon the expenditure side. He did not explain that while he estimated the expenditure at a certain amount, the actual expenditure would be much higher. There was no explanation of that at all. We were told that the reason there was a deficit was because there had been a decrease in the consumption of alcoholic liquor and that certain income tax returns had fallen off because of bad conditions. In fact that has been over-expenditure on the estimated expenditure side. Does the Minister for Industry and Commerce ever think of what is really going on? The Government prompted, if you like, by motives which might be ambitious and might have benefits to the country, entered upon the Shannon Scheme. They estimated that the Shannon Scheme was going to cost eight or possibly nine million pounds. I do not find fault with them for being wrong in their estimate. I find fault with them that when they found themselves wrong they did not face up to it and put their cards on the table and say let everyone come along, whether by criticism adverse or otherwise, and help the scheme. They estimated that the Shannon Scheme would cost £8,000,000. We find now it is possibly going to cost twice as much.
Who told you that?
I say it is possibly going to cost twice as much. If the Minister would have the courage to bring his figures into the House and have them analysed then we would know where we are. The Minister has not got the courage to bring the figures to the House.
That being so you are going to say sixteen millions.
No, fifteen millions has been quoted by other Deputies.
By whom?
If the Minister was interested in the debate he would have been here. He can read the debate and find out for himself. My figure four years ago was ten millions, and the Minister ridiculed it. I subsequently increased my figure to twelve millions and the Minister ridiculed it. I now say that it is certainly not under thirteen millions.
And I still ridicule it.
And the people will ridicule the Minister when they read the posters: "More Shannon Schemes for Ireland; Current Cheaper than Ever," at a time when the people are paying more than they ever paid by way of taxation as well as for the price of current. The Minister still says that we are ridiculous people, and that he is the clever person. There is a limit to the squeezing of the lemon whether the imposition is by way of income tax, or by way of indirect tax. The limit has been reached in many cases. I say that the Minister for Industry and Commerce is not giving the workers on the Shannon Scheme a fair deal by stifling discussion, because the Minister will realise that some day the human element will collapse, just as the financial and technical elements have already collapsed. Employees on the scheme have been asked to work overtime amounting to six hours per day since last March, and in some cases November, and some got no overtime while others got sixpence.
I did not ask any one to work overtime.
It is being done.
I did not do it.
I put the responsibility on you because you cannot shed your responsibility for having misled and fooled the people of this country for so many years. I will not approve of employees with 30/- or 35/- a week being asked to work six hours a day overtime, in some cases for nothing and in some cases for sixpence an hour.
The Deputy is now trying to raise what he was told to-day he could not raise on the adjournment.
No.
The Deputy is trying to raise now what he could not raise to-day.
If I cannot get consideration from Deputy Morrissey for the working man——
Deputy Briscoe cannot get away with that. The Deputy is being kept in order by the Chair.
I want to talk about the system of finances and the system of squeezing the lemon. The last drop will be squeezed out some time and nothing will remain but the empty shell. The Executive Council will find themselves with an empty shell shortly. Deputy Law visualised the impossibility of people bringing home money or investments, in order to put it into Irish industry, in view of the treatment they get by interpretation of income tax law. I agree with the Deputy there. I say that the Minister for Finance should realise that of the reputed £200,000,000 that is deposited in the banks by the people of this country a good deal has been lost in foreign securities or has become valueless because these securities have ceased to pay interest, and if the owners attempted to bring them home the amount would be much less than when it was sent abroad. The Minister will have to consider the financing of State expenditure from a different angle to what he did in the past. The Minister for Finance certainly does not hide the fact that the 4d. on petrol is a tax. We do not know even yet what will happen between this and the end of the financial year.
[An Ceann Comhairle took the Chair.]
Is the Minister satisfied that the rest of his figures are going to work out according to plan, and that he is only going to be short this £900,000 of which he has provided for, say, £450,000? Supposing the drop that has started in alcoholic liquors increases during the year, what is he going to do? Is he going to introduce a second Supplementary Budget before the end of the financial year, if the Government is there to do so? I asked the Minister for Finance a question to-day and I hope that you, A Chinn Comhairle, will tell me if I will be permitted to raise it on the adjournment, even though the Minister will not be here.
The Deputy can raise it now if he chooses.
No. I desire to raise it on the adjournment when I will be able to elaborate it and to give certain figures. I desire to raise it even though the Minister will not be here.
That precedent has been created.
I asked the Minister a certain question. The Minister for Industry and Commerce will keep on laughing until the Drumm battery scandal is exposed and then he will stop laughing. He laughs in spite of the unmasking of the Shannon scheme. He is laughing now and will keep on laughing until the Drumm battery business is charged and then we will have something else. He will not be able to stand that last defeat.
I asked the Minister a question and I intend to give figures. I think every decent minded Deputy will agree with me. It was brought to my notice that the State owed money in America or part of the Second National Loan which had been floated in dollars. It was brought to my notice that portion of the Second Loan, although floated in pounds was convertible on demand into dollars. Realising that the pound had fallen very considerably in relation to the dollar I realised that our interest and sinking fund commitments had considerably increased.
I was one of the members on the Public Accounts Committee who took an interest in Savings Certificates. We brought it to the notice of the Minister for Finance that the system they had for dealing with Savings Certificates was too costly for the State. It was subsequently changed and I believe the Public Accounts Committee felt that they had rendered a service, that although it was not made public they had saved the State borrowing money at too high a rate. I approach this question in the same way. What is the Minister's attitude? He does not know whether it is costing any more to pay the interest. The interest was paid on 1st November and the Minister must have known whether the cost was more or not. I intend to give figures to show that we have a Minister who talks about raising £450,000 by extra taxation, but laughs at a couple of hundred thousand pounds lost in this way. He has no statement to make, no programme, and he has nothing to say on the adjournment and is not going to be here. I suppose a few Deputies will be here and it will be on the records so that at some future time the people will be able to judge the Government. I do not intend to appeal to the Minister nor do I expect that he will take any notice of criticism I have to offer or of any information that I will lay before him. I am satisfied that the Executive Council made up their minds that this was the best way out for them, and that nothing will alter their decision. Anything said here is only a waste of time. I want, however, to have it on record that I, at least, have intimated to the House that the amount of income which the Minister expects to get by this extra 4d. on petrol, is not going to materialise. In fact, this £450,000 which they expect to get towards this deficit of £900,000 which they admit but which is, in fact, more, is going to be a lot less. We are going to be faced with a deficit in spite of this tax and in spite of the £450,000 which the Minister is to raise by way of savings.
Some members of the House may wake up and realise that they have a responsibility not only to Cumann na nGaedheal, who keep them there for fear they will go out in a storm, but to the people who sent them here. They have a responsibility to the people who will have to bear the burden after this House is changed in its composition. If they are going to look upon Bills of this kind purely on Party lines, after it is brought to their notice that their management is wrong, that the medicines which they introduce are wrong, and that other methods should be adopted, it is going to bring further distress to the country. They may talk about money for housing, but the fact remains that money cannot be got at the present time to meet the demands for housing. Any member of a corporation or local body knows that money cannot be got to deal with the housing situation, because of the distress, unemployment, lack of industry and lack of stability, due to the administration of the Government. There is no sense in making appeals to the Minister. The Minister will not listen to them. All we can do now is to warn the Minister and mark time. When the general election does come, those who are out against the Government should make all they can out of the insulting behaviour towards members of this House who offer suggestions or criticisms. Members who offer suggestions are met with jeers and sneers. The people of the country are waking up to that and, I believe, the Ministry realises it.
We, on this side of the House, have been rather dense for the past fortnight. We did not know what was really happening. We could not find out. We should have guessed that there were eggs when we saw shells. When, three weeks ago, the Government Party started to organise and create a war scare; started to incite the clergy to make statement about hundreds of paid Communist agents who were trying to lead the Irish people away from the Catholic Church to worship at the feet of some antiChrist, while agents of Cumann na nGaedheal through the whole of the Twenty-six Counties were whispering in every home that they could get in touch with, about the black clouds of Communism and secret plots of war and murder, the people were wondering what it was all about. We were in the same position. We thought at first that it was a general election scare. Then we thought of many things. But we never thought that it all was owing to the financial crash that was coming, as explained here by the Minister for Finance last Friday. He let the cat out of the bag after they had created an atmosphere which would prevent people thinking seriously and clearly on a matter of this kind.
The State had gone bankrupt in a lesser period than one year to the tune of practically a million pounds. It was to cover up that position and to prevent the people clearly thinking of it that they created this scare a few weeks ago. I think they are to be congratulated on their methods. If this financial crash had been explained to the people three weeks or a month ago, when they could look at the matter without threats or war scares, without any knowledge of Communism, or anything else, when they were thinking of their own business, their fairs and markets—if this had been explained to them, then, Government Deputies would get very little respect throughout the country. They are to be congratulated on the manner in which they have introduced this bombshell,
I have a strong objection to the manner in which the Minister for Finance introduced this supplementary Budget. He did not tell the truth. He started off, when talking about a drop of £80,000 in income tax, to explain that it was due to a slowing up in the collection of outstanding arrears. I hold that it is not so. There has been no slowing up in the collection of outstanding arrears. If what the Minister says is true, will somebody on the front bench tell us on whose authority the slowing up process took place?
If there are arrears to the amount of £80,000 outstanding, why were they not collected? Are we to assume that the Minister for Finance gave instructions that the income tax collectors were not to go ahead with the collection of £80,000 arrears? I hold that the statement the Minister made here was a false statement. The facts are that the outstanding arrears have been all paid up, that the Minister's agents did not get the £80,000 that he expected because it was not there. The wells of income tax have gone dry. They put on the screw for the last seven or eight years in respect of those arrears which accrued prior to the Truce, and they have simply squeezed out of those sources every penny they had. There is nothing more to be got, and that is the explanation of the drop of £80,000. It would be much more decent for the Minister to state that, and not to pretend that they had given up collecting income tax arrears. That is one of the mis-statements of the Minister and I think a very dishonest mis-statement.
The Minister talked about the drop in the duty on beer and spirits, the amount being £670,000. In a sense, that is deplorable. It has come to me with as great a surprise as the drop in income tax arrears. When I noticed the activity of the income tax collectors, it was surprising to me that they had not got more than they had estimated for. It is also a surprise to me that there is a drop of £670,000 in the duty on beer and spirits. What happened the licensed trade after the two or three day debate we had practically a year ago, when the Minister for Justice proposed to put the licensed trade on its feet by introducing a Bill to open the public houses on one day in the year? What has happened the licensed trade since?
After all the great speeches that were made to the effect that the Government had a wonderful interest in the licensed trade, and that the members of it were no longer going to be sufferers, speeches from people who have been content to pull the legs and sound the purses of the members of the licensed trade for years past, we now find that there has been a drop of £670,000 in the duty on beer and spirits. I suggest that the Government have proved themselves very peculiar friends to the members of the licensed trade.
The Government say, of course, that this fall in the duty from beer and spirits is due to lack of consumption. The Minister for Finance said that it was due to some mysterious outside causes that he did not explain. I think that neither statement is true. In my opinion, the loss under this head is due to the general depression that prevails throughout the country, to the lack and loss of trade, and to the increasing burden of taxation on the members of the licensed trade as well as on the community in general. That, in my opinion, is what has been responsible for the loss of income from the beer and spirit duty. The Minister for Finance also stated that the Budget deficit which he anticipates is due to outside causes. That is the Government's usual attitude; that they have not been in any way responsible for this loss or deficit of £1,000,000. They say that it is due to outside causes over which they have no control. The Government, according to themselves, are not to be blamed for the step in the direction of bankruptcy that has been taken in the last year. But the Minister for Finance, or those who sit on the benches oppocite, cannot expect to get away with that argument.
The position in which the country now finds itself is not due to outside causes but is due absolutely to the failure of the Government to face up at any time to the situation in the country. It is due to the attitude of the Government in always hoping against hope, that something will happen in England, that the ban on emigration will be taken off in America or that something will happen in some other country to make the people here prosperous. The Government have always refused to take any action that would have the effect of making this country prosperous. Their attitude has always been to trust to outside causes to bring about that situation. They sat tight and refused to budge when they saw that our trade was declining by millions of pounds, when our cattle population was being reduced by thousands, when tillage was being reduced by hundreds of thousands of acres, when the unemployment figures were mounting, and when salaries were rising almost to bulging point. During all that period they refused to face up to the situation here at home and to deal with it in an Irish way. They allowed things to drift.
A few months ago when England went off the gold standard we had the bright statement of the President, in Cork, "Do not worry, everything will be all right; there is going to be a great demand for Irish produce in the English market; the Danes are going to lose the place they have held there, and the position of the Irish farmer is going to be stronger on the English market than it ever was before. The prices for Irish cattle and Irish produce are going to rise, and as a result of England going off the gold standard everything is going to be better for us than ever it was before." An even greater prophet than the President—at least, I think he is, for he is a county man of my own—the Minister for Justice, went down and told the people in County Mayo, "Do not worry; carry on as if nothing had happened."
I wonder will the Minister now go down to the people in County Mayo and tell them to carry on as if nothing had happened, in view of the fact that they are now to be burdened with an extra million pounds taxation. Will he tell them that that does not make the least difference to them? That is the manner in which those who sit on the front bench opposite always face up to a situation in this country. They close their eyes to the facts that stare them. When suggestions were made from these benches as to how economies could be effected and how millions of pounds could be saved, these suggestions were simply met by sneers and insults from those sitting opposite on the front bench.
There is one matter that the Minister for Finance mentioned on Friday last that I, at all events, would like to hear him deal with when winding up this debate. He said that they were going to have retrenchment now. Well, at least, that is one conversion, that we are going to have retrenchment. Last year the Minister told us it was impossible to economise by one penny more, that they had come down to rock bottom and that not one penny more could be saved on State services. It is something, at all events, that the Minister now admits that over £500,000 can be saved by way of economies. I ask Deputies to mark this: That on Friday last the Minister for Finance made an appeal to Fianna Fáil Deputies to help him in effecting economies. In his usual hypocritical fashion the Minister said that he did not believe that we would help him to economise; that we were out for lavish expenditure, but still he appealed to us, that in our charity we might help him to effect economies. On Friday last he said: "Therefore, in the appeal that I am making to Deputies for practical support in the matter of economy and retrenchments, I would hope that it would not be given now or for the next month or so, merely, but that it would be such as to affect the estimates of expenditure for the financial year beginning in April next."
What exactly does the Minister mean? Does he mean that members of the House in their approach to the Departments should ask them to economise from now until April next so that the Estimates to be introduced then can be considerably reduced? In the case of the Estimates in which we are interested, such as old age pensions, the Land Commission, and the Board of works, does he mean that we should slacken in our efforts and not continue to demand justice for the people in the congested districts; that we should ask that the Land Commission should not proceed with work which can be of very great assistance to the people? Does he mean that we should not appeal for justice for the old age pensioners? Is that the way that the Minister for Finance means to economise? I am greatly afraid that is his intention. What about the year 1928, when the Government paid out practically £100,000 in army doles and pensions? While they did that they reduced the Land Commission Estimate for the improvement of estates by £152,000.
That is the kind of economy the Government carry out. They could give nearly £100,000 in Army doles and pensions and now they want economies effected to the tune of £500,000. Is it their purpose now to economise by cutting down social services, by failing to provide sufficient money for the improvement of estates in the West of Ireland and other places and for the Old Age Pensions branch? If they propose to effect economies at the expense of the poorest people in the country then they are going to get very little help for that kind of economy from this side of the House. I know that they will get support for it from their own members, but Deputies on this side will oppose economy of that kind in every way that they can. There are other ways in which economies could be effected besides cutting down the old age pensions and refusing to provide money for the improvement of estates. When we indicated ways in which economies could be effected without inflicting any hardship on the poorest of our people, we were simply sneered at by the Minister for Industry and Commerce and the Minister for Agriculture. I am not going to say much about the speeches made by the two Ministers in the debate on Friday last. All that I regret is that I cannot afford to purchase 1,000,000 copies of the Official debates for the purpose of having them distributed amongst the people of the country. If the people could be got to read the speeches made by those two Ministers they would get some realisation of the kind of sneers and insults that are offered by members on the front bench opposite to members on this side of the House in the case of every important debate that takes place here.
The contribution of the Minister for Agriculture to the debate is summed up in a few lines when he said that "these people (meaning the Fianna Fáil Party) who talk so much about finance and economics and resurrecting the development of the country would rather see the economic and financial position go to bits than to see it coming right." I would like to know what authority the Minister for Agriculture has for making that statement—that members on this side are only too glad to see this State breaking up and going to bits rather than to see it coming right? What authority has that slandering Minister to come to the House and make that statement? When he talks about dishonesty let him apply that charge of dishonesty to his own benches and he will find there a more re-echoing sound than he will find here. That is the way they meet the arguments put forward from this side.
Of course again the Minister for Industry and Commerce, this man who seems angry that he was ever born, comes to attack members here, and he goes over a series of events from 1922 down, in dealing with this supplementary Budget. He talks of raids on Mountjoy in 1924, of Article 11 of the Treaty and of the burning of Cork. He talks about some other things that have no connection with this debate, and he finishes up by saying that there is absolute dishonesty in every suggestion and insincerity in every statement made by members on this side of the House. That is the whole tenour of his speech—absolute dishonesty and insincerity. What authority or right has he to impute dishonest motives to any member of the House no matter on what side he sits? Are these the only methods he has to meet the arguments put forward? Then, in his usual way, after listening here three weeks ago to lectures on morality. Catholicity, lectures on Christian brotherhood and on charity, from the Minister for Defence, he comes forward with a statement like the Head of the State, who objects to be called Mr. Cosgrave, and calls one of the leaders of this Party an ass. These were not his actual words, but he said that "the Deputy had not the ears of an ass, but that he had all the other attributes of the species." These are all very nice, laudable methods, but where are the doctrines of morality and theology about which we heard a few weeks ago? Where have they gone to? Have these doctrines only to be practised by members of the Fianna Fáil Party? Are they themselves immune from the practice of these doctrines? He dealt with the statement of Deputy de Valera that economy could be practised in the higher grades of the Civil Service and treated it in his old word-twisting fashion. He said that if you economised in the Civil Service—Deputy de Valera was speaking of those who are in the highly paid positions in the Civil Service—you will suffer a greater loss to the State. What did he mean there? What is the insinuation? Was it that if a civil servant who was getting £1,000 per annum is to be reduced in salary by ten per cent, that civil servant is going to be negligent in his work, or is going to defraud, that that civil servant will not work every day as faithfully as heretofore? Is that the suggestion that comes from the Minister? Where is the morality preached to us by the Minister a few weeks ago? Is it not to be practised by the Civil Service? Is that the doctrine the Minister preaches, that because you have a reduction of ten per cent. in a civil servant's salary, he is going to defraud the Government of the country, that he is not going to carry out his duty to his Department, or his duty to the State? That is the suggestion that comes from the benches from which we are so often lectured on morality and Catholicity.
I wonder was that immoral doctrine in the Minister's mind when they decided on a ten per cent. cut in the salaries of national teachers a few years ago? Could he not put forward the same doctrine at that time that if the Government reduced their salaries they would not give a return for what they were paid or that they would fail in their duty? Was that immoral doctrine in the mind of the Minister for Industry and Commerce a few weeks ago, when a ten per cent. cut was made in the pay of the lower branches of the Civil Service, when a postman who was paid £2 16s. per week was cut down to £2 11s. per week? Where was the suggestion then of the immoral doctrine that was put up by the Minister for Industry and Commerce to-day, that if you make a cut in that postman's pay he will not give a return to the State for the money that is given to him or that he will defraud the State? Are these immoral doctrines of the Minister for Industry and Commerce to be reserved for the gentlemen in the Civil Service, who are in receipt of salaries of £1,000 or £1,200 per year? Are these immoral doctrines not to be applied in the case of the man who has a salary of from 30s. to £2 a week? That is the method by which the Minister for Industry and Commerce deals with the demand for economies in the Civil Service. That is the argument. I hold it is a very wrong argument, but I would say it is worthy of the Minister who used it and it is worthy of the attitude of members on the front bench opposite ever since they came into public life.
In the extraordinary diatribe which we have just listened to from Deputy Clery, he complained rather bitterly that the arguments which he and his colleagues from the benches opposite produced, are never listened to. He may be quite right in that, because I certainly listened to Deputy Clery with the greatest attention, and I also listened to a couple of speakers from the same side before him, and certainly I could find nothing that could, by the greatest stretch of the imagination, be made pass for argument in the speech which Deputy Clery or the preceding speakers from that side of the House made. What does Deputy Clery complain about? He complains that it has been stated that his Party are glad to see the State breaking up. Well, if they are not, if it is not their wish and their desire, if the Fianna Fáil Party is not always anxious to hear bad things about the financial condition of this country, if the Fianna Fáil Party is not always endeavouring to create every sort of rumour they can that could injure this country, I, for my part, cannot see what they are endeavouring to do.
I find among the speeches here to-night a speech from Deputy Briscoe full of course of patriotism, burning with patriotism. Yet his speech is an endeavour to make out that the Shannon Scheme has been a failure, and an endeavour to make out that the Drumm battery is a failure. Why, the whole time that excellent Deputy was gloating over the thought that possibly the efforts made for the good of this country by the Executive Council would fail. That was the desire, and the one desire. Listening to the speech that Deputy Clery made here to-night, I do not believe that any man who was not animated by a desire to see economic tragedy and disaster descend upon this country could have made that speech. He talks about the nation being bankrupt, and our having come down with a financial crash. I am afraid, a Chinn Comhairle, the wish was father to the thought.
There has been no national bankruptcy. The State has not gone down in her great financial crash. This State stands at present financially as strong and as firm as any State stands in the world, and none of the attacks which Deputy Clery makes or which any other Deputy from the Fianna Fáil Benches makes upon the stability of this State, in the hopes of shaking the financial foundations of the State—because there can be, in my opinion, no other motive—will do them the slightest bit of good. They will not deceive the people at home, and they will not shake the confidence with which people outside this country regard our institutions.
Deputy Clery talked about a scare which has been manufactured last month, and he talked in his usual insulting fashion about clergymen being fooled, and all that kind of stuff.
I did not say that.
Or words to that effect. What is the fact, and where does the Deputy stand now?
Where I always stood.
The one thing necessary for the financial stability of this State is that there should be law preserved all thorugh the State, and that the people of this country shall be able to develop the resources of this country, free from any attempt to disturb them by armed violence. Deputy Clery may not quite agree in that proposition. Deputy Clery is a gentleman who, if I am not mistaken, when a certain paper stated that he disapproved of murder got up and said that he had been misrepresented.
You are very much mistaken. I disapprove of murder, and that is a wrong statement to make.
What did Deputy Clery state?
I disapprove of murder by some of your agents.
Did the Deputy approve or was he sorry when a paper reported him as saying that he disapproved of the murder of young Ryan?
I did not do that.
We had all this on another Bill. This is a Finance Bill, not a question of law and order or of murder. Deputy Clery used this question as a preamble, and I was going to tell him what I am telling the Minister now when he finished his preamble and got on to the Financial question.
I bow naturally to your ruling. Deputy Clery said that the Minister for Finance had deliberately mis-stated facts to the House when he said there had been a slowing up in the collection of £80,000 or thereabouts which were estimated as arrears of income tax. What did the Minister state? He stated perfectly clearly:
"There is also a fall of about £80,000 in the yield from income tax. That fall in the yield from income tax reflects a slowing up in the collection of old arrears. It does not reflect any under-estimation in the yield of current tax or any failure to collect current tax. It represents a slowing up which was not anticipated in the collection of outstanding arrears."
That is what the Minister said. That is no mis-statement to the House. It is a perfectly plain statement of fact to the House. When you are collecting old arrears, especially in times when there is all over the world a certain amount of financial depression, we must recognise that it is harder to collect in these old sums. It naturally gets harder, and the Minister said it was harder to collect that £80,000 than he had anticipated. How is that misleading the House? What right has the Deputy to state that the Minister has deliberately misled the House when the Minister has made a statement of fact, that owing to the change of circumstances, owing to the change of world conditions since the passing of the Finance Act this year, since his introduction of the Budget this year, that is a thing which you would anticipate would happen. Yet Deputy Clery gets up and says that it was an entire mis-statement by the Minister, and an attempt to deceive the House.
Then he talks about the beer duty. The Minister told him that the beer duty is not a complete sign as to the consumption of beer either in this country or outside this country. It is paid according to the output of the brewer, and it is paid within a certain time. It is paid not upon what is consumed, but upon what the brewer thinks at any particular time is wise for him to produce. He considers what is likely to be consumed, but he also considers what stock he is likely to carry on hands, and it is upon that that this was based.
Now Deputies opposite, of course, have wandered very far, but let us take some of these things. They stated that there was a policy of drift on the part of the Executive Council. Hardly anything could be more grossly absurd. When you embark on a large scheme like the Shannon Scheme, is that drifting? Is that doing nothing? When you embark on a big thing like the Carlow Beet Sugar factory or any of your large drainage schemes which have been embarked upon is that a policy of drifting? When you deliberately take one by one each of the articles on which you think by putting a tax you can stimulate production here is that a policy of drifting? If you put a tax on boots long before Deputies opposite came in to the House, is that a policy of drifting? If you take every single question, and examine it on its merits and act when you think action would be helpful to this country, but you do not act precipitately, is it fair to call that a policy of drifting? I would venture to say if you wanted to criticise this Government you could criticise its every overt action, but you cannot criticise this Government and its policy as being one of drifting. That must be completely to misrepresent, and I am afraid consciously to misrepresent, the economic history of this country during the last few years. The Deputy says that I was completely wrong when I said that it was the correct thing for the people to do to increase production now as much as they possibly could. He said that I would not dare to go down to Mayo and repeat that. I will go down to Mayo, and I will repeat it and ring it off every platform in Mayo, that it is the correct thing and the wisest thing to produce as much as possible at the present moment, and that the price of agricultural produce must rise if the £ remains deflated. I say that is an A.B.C. proposition.
Deputy Clery seems to suggest, and he expresses his meaning very badly if he did not, that there has been no alteration now, therefore no alteration can come. That seems to be his economic mind, therefore, that in a thing like currency if deflation is not followed by an immediate alteration in prices it cannot be followed at all. If anybody, I should say, gives one second's thought—I do not suppose Deputies opposite give many minutes' thought before they make speeches in this House, to judge by the products they do not—they would know that deflation is a thing which must take effect slowly and by degrees. You had even an example of it here. You had tremendous deflation during the War. You had an enormous rise in prices but how slowly that rise came to begin with. I am perfectly satisfied that we, tied to the British currency as we are and, therefore, off the gold standard now, have gained enormously by that. Denmark and Sweden have had to go off the gold standard. What is the result? They have got millions of gold lying utterly unproductive. I would not trust my memory just at the moment to give the exact figure of gold reserves which Denmark has got, but if my recollection is not wrong it is something like six millions and that six millions of gold reserve is lying there perfectly valueless, producing no interest because they have had to go off the gold standard. Whereas our currency is so invested that it is bringing in a steady income for us. So much for the question of the gold standard.
There is one thing which we have not heard from the Deputies opposite. We have heard an attack to a small extent upon the income tax and very largely upon petrol but we heard no alternative suggestions. We heard a great deal from Deputy Clery where if there are to be economies you are not to economise, but we heard nowhere from him where we are to economise except on one matter, the salaries of the higher paid civil servants. In that he was following his leader, Deputy de Valera, because Deputy de Valera made precisely the same suggestion—economise upon the expenses of the household of the Governor-General and upon the higher civil servants. Every single Deputy opposite must know that that is a dishonest argument to put forward. Deputy Clery attacked the Minister for Industry and Commerce because he said it was immoral to argue in that strain. I repeat that it is immoral to argue in that strain; it is trying to deceive the country deliberately. You know perfectly well that economies that can be effected in the salaries of the higher paid civil servants or in the pay of the Governor-General are absolutely trifling, running to a few thousand pounds and nothing more. Yet you deliberately wish the country to understand that in reducing the salaries of civil servants who are paid over a £1,000 a year by ten per cent. you are doing all the economies necessary. That is what Deputy Clery's and Deputy de Valera's speeches come to. To come along and talk vaguely about economies without saying where they are to come from, except very trifling economies, is deliberately to attempt to deceive the electorate of this country, and to proceed in that fashion, is, in my judgment as it was in the judgment of the Minister for Industry and Commerce, immoral and immoral is the proper term to apply to a course of conduct of that kind. We know that the whole world is suffering at the present time from serious economic depression. We know that this country could not have hoped to escape from that economic depression. When trade goes down in one country it pulls down the trade in another; when trade goes down in all the countries in the world except one it is bound to pull down the trade in that one also. Therefore, we could not possibly have expected that the repercussions from the economic depressions elsewhere would not react in this country. They have reacted and because they have reacted there has been a necessity on our part to increase present taxation. We have had to do so less I believe than almost any of, if not all, the countries in the world and in that we are fortunate. We come here to this House and what do we find? We find general complaining. "Oh, we are not told this, that or the other." But we do not find from that one single, fair, constructive idea put forward for the enlightenment of this House and this nation.
The Minister for Justice has charged Fianna Fáil with so much insincerity that they are actually anxious to see chaos existing in the State. I suggest to the Minister for Justice that that suggestion is immoral. I have no intention of qualifying the statement that that suggestion of the Minister for Justice is immoral. He knows perfectly well that the ruin of the economic position and of the credit of this State has been caused much more by the speech he made in County Mayo during the Recess, the speech he made in this House, and the speeches of the other Ministers three weeks ago, when they held up this country as being a country that was rife with every agency that made for the destruction of morals and decent social standards.
And also showed that it was capable of curbing, and did curb, such persons and thereby establish our credit in the world.
When showing all these qualities that we possess the Minister knows perfectly well that he and the other Ministers have the responsibility for damaging the character of this State. I read the speech of the Minister for Justice and I listened to the speeches of other Ministers on the amendment of the Constitution Bill. I heard the Minister for Defence deliberately state that Deputies who came up here from Leitrim knew that a state of terror existed there.
We have got to keep to the financial side. The Minister for Justice was stopped on this.
The Minister for Justice made certain statements and I suggest I am entitled to reply to them.
All the statements that the Minister for Justice made from time to time cannot be raised on this debate, nor can anybody else's statement either. We had an interchange between the Minister for Justice and Deputy Clery on that point and we are going right off it now.
Deputy Law speaking here on this matter stated that anything that brings money into the country is good and that anything that discourages money coming in is bad. I suppose that is economically sound, but I wonder if the safeguarding of the people's money is not of more vital interest to the citizens of this State and the wellbeing of the nation as a whole than merely giving encouragement to outside money to come in for the purpose of making substantial dividends or such dividends as might be made out of their investments and the work of the people. Deputy Law and the Government Party have recommended as a glorious achievement for the economic advance of this country the placing of our currency on a level with that of Great Britain.
In the doing of that they have lost practically 25 per cent. of the entire capital investment of this country. No great regret is shown there at all; not one word of regret; not one word of condemnation on the part of the Government that have, by their arrangement of the handling of the people's finances, the internal finances of this country, swept them away by at least 25 per cent. without the people being given an opportunity of expressing their opinions.
They are encouraging by all means outside people to come here and invest money. That is the policy which has brought us to-day to the position in which we are. Increased taxation to the extent of £450,000 is to be collected from the workers of the country for the purpose of building up. It is just like a break-down gang making some temporary fixtures upon the structure that the Government have run into ruin. If this taxation had for its purpose the development of any useful industry, if it had for its purpose the rehabilitation of the agricultural industry that has been forced for the last four or five years into a chronic state of bankruptcy, if it had for its purpose the building of houses, the finding of work for the unemployed in any of the various projects that could be developed, if the money was going to find its way, in another channel, back to some object that would be reproductive, then we could say that we had practical agreement to the extent that the purpose of the taxation was good, even if we might to some degree differ as to the means of finding money. But this taxation, instead of going to solve the economic problems that confront us, and that are daily growing more and more, instead of being diverted to some useful channel, is, we are told, going to be utilised to make good the deficits due to extravagance, waste and mismanagement on the part of the Government.
An additional charge is being imposed upon the purchasing power of the people, and it automatically must happen that as time goes on the ability of the people to continue the present taxation must decrease. As it is, there are numerous instances where people are unable to meet the present rate of taxation and, with this additional charge, their lot as time goes on will be particularly unhappy. No effort is made to adjust the situation to what the people are capable of paying towards the expenditure of the State. Every year since we came here we on these benches have disclosed the true position of affairs. We have described the depression that existed and exists in agriculture and in the business life of the towns. Whether we were believed or not, at any rate no consideration was given to us. No effort was made to do as we suggested with the object of reducing expenditure. The expenditure went merrily on and probably would still be going on were it not for the collapse of the pound and the economic pressure that was thereby brought about. If it were not for that, the condition of affairs in the agricultural, industrial and business life of the country would not have been taken into account in any serious manner.
[An Leas-Cheann Comhairle took the Chair.]
Deputy J. X Murphy spoke here this evening on this question and he referred in a complaining manner to the expenditure of £750,000 that went this year towards the relief of agricultural rates. I presume that Deputy Murphy speaks, not as an ordinary citizen, but with the full responsibility that he carries as director of the Bank of Ireland. I go so far as to suggest that the gentleman in question is not entirely without ordinary human feeling. That being so, I can only put his complaint down to complete ignorance of the situation in question.
If I may interrupt the Deputy, I must say that I did not complain. I said I did not think that the £750,000 pleased anyone—they did not appear to be satisfied, anyhow.
I suggest that while it did not please the farmers to the extent that they felt they had a perfect right to, it at least pleased them to the extent that they considered it was of benefit anyway. If that is the mentality of a man who holds a responsible position in the principal banking institution in this country, I suggest to him that in the interests of the institution he speaks for he should get in touch with those who represent the industry which his institution, as well as other institutions in the State, is based upon—agriculture. If he did so he would realise that the £750,000 was a very necessary grant towards that industry.
I suggest that overbearance and neglect to understand that industry is, in the case of banking institutions, wrong and will lead to bad results. The farmers in the past dealt with people who claimed to have a superior mentality and outlook. They dealt with them successfully, and the people have got their rights, to some degree anyhow. I suggest to Deputy Murphy that he should have himself properly informed upon the essential industry that I speak of, so that when he refers to it again he may be able to speak with intelligence of the real wants of the people, and not misrepresent their position.
I do not want any Deputy to misrepresent me. What I said was that the smallholder, who is the person we were all anxious to benefit, received no benefit whatever from his proportion of the £750,000, because he would have to pay an equivalent sum in the extra price of sugar and other things. I stated that the smallholder would not receive any appreciable benefit in that way.
Did the Deputy vote against it here?
The proposals we have made here for the last four years have been founded upon the real position of affairs in the country. The Ministers who suggest that our criticism is nothing more than shallow criticism and is without sincerity are representing the situation in an immoral manner. Our suggestions of bringing about economy by the reduction of unnecessary expenditure, and by bringing the expenditure of the State into conformity with the true position in the country would, if carried into effect, have resulted in leaving this State to-day in an independent position, and it would be advancing to a very great extent along prosperous lines. These are not ideas that have sprung up for the purpose of meeting the present difficulty or making the path more difficult for Ministers. One cannot help saying hard things when one feels that all through the years that we have been here advocating a certain policy, on every occasion our suggestions have been sneered at, rejected and represented as impractical. What proposal have the Government, even at this stage, for dealing with the unemployment problem and the increase in our population of approximately 30,000 a year, which we must provide for in one form or another in the future? Is there any proposal coming from the Government to deal with that problem or are we to be occupied in this House, week after week, by Coercion Acts, followed by a new Taxation Act or Supplementary Budget? Is that the sole purpose for this Assembly?
No serious effort has been made to deal with the real problem. In these circumstances I think that it is not alone immoral, but criminal, on the part of the Government to continue along such lines. We are lectured upon morals and upon Christian ideals, and are told of the menace and danger of Communism and of Russian agents. Whatever forces may operate in this country, none of them can be more dangerous than the neglect on the part of the Government to deal with the economic problems that exist. Speaking from knowledge, I can say, and I have told the Government so on many occasions, that there is a problem in the congested areas which is responsible for inflicting hardship on the people there that a Christian Government should not allow to go on without making an effort to solve.
Each year the situation has grown worse. Neglect on the part of those in authority to tackle it in a practical way is unchristian. No amount of camouflage will get rid of the responsibility. As Deputy Clery says, further light has been thrown by this Bill on the action of the Government three weeks ago in blackmailing this country by representing it as being full of forces that were moving towards disruption, and ruining our credit in the eyes of the world and internally, by forcing through a Coercion Act which has no parallel in any country. It was a smoke-screen to allow the Government to come forward with increased taxation, to allow the Government to drive the people by terrorism into forgetfulness of the position in which ordinary individuals would, without doubt, take strong measures to deal with them. I suggest that the Government, having mismanaged the business of the State, having brought us to a position of bankruptcy, ought to go to the country and ask for a verdict on their nine years of office.
I propose to confine myself mainly to examining certain statements by the Minister in introducing those proposals. Before I do so, I cannot refrain from commenting upon the way in which these proposals were rushed through last Friday. It makes the debate largely futile. The real interest and importance of the debate would be on the day when the proposals were introduced. Although we were willing at that time to accommodate the Minister and remain on here as long as he chose in order to debate the proposals fully, that offer was refused on the ground that it would interfere with the personal convenience of certain prosperous business men and others in his Party. Apparently, their interests were of greater importance than a matter of such national interest as the imposition of taxes. The Ceann Comhairle pointed out, in intervening on the point of order, that after the appointment of a President the next most important matter that could be dealt with in this House was the question of the imposition of taxes. Yet, the interest of certain individuals were paramount to the interests of the whole nation in one of the most important matters that we can deal with in this House. Other reasons were given outside this Assembly in conversation which were very different from those given in the House, namely, that it was due to some blunder on the part of the Government that proper notice had not been given to the Opposition of the measures they were about to bring in. The Ceann Comhairle said we were establishing a precedent with reference to Supplementary Budgets in the future, and the Government have now established the precedent that any Minister for Finance can come in on a Friday morning and rush through in a few hours a Supplementary Budget without giving notice of any kind to the Opposition.
I do not believe that the explanation I mentioned is the correct one, that it was an accidental blunder. That it was a deliberate blunder is obvious to those who see it in the light of previous legislation. As Deputy Maguire has said, there was a smoke-screen put up first. The Government knew they were beaten in the country. They knew they had to face an unbalanced Budget and they thought the best way to do it in order to save themselves from defeat would be to carry out a most atrocious propaganda, by privately giving false information to the Bishops and others and by creating an atmosphere of terror by sending armed plain clothes soldiers to accompany Deputies without any real reason for it and then by passing a Constitution (Amendment) Bill which amends the Constitution out of existence. That was the smoke-screen under which they hoped to get through their measures. They hoped that we would have marched out of the House to help to create that atmosphere. It was with that prospect in mind that they were going to introduce this Bill because they never expected that they were going to have any discussion. They forgot the Opposition. No one was more disconcerted than the Government when we did not walk out of the House and help them in the creation of a panic here.
We are now faced with this measure and we have to analyse very carefully the grounds upon which it is being introduced. The Minister's statement was a very unsatisfactory one. It was brief, vague and shifty, and gave no necessary explanation of the matters which were of the greatest importance to any Assembly setting out to analyse the deficit on the Budget and to remedy that by further taxation, and by retrenchment. The Minister's statement was really an insult to the intelligence of the House. He referred in vague terms to the causes of the deficit. He admitted that the declining yield from alcoholic liquor was primarily due to the high rate of taxation. That is to say, that the rate of taxation was beyond the capacity of the people to pay. The effect of that was that they had to reduce what was their normal consumption.
In other words, to use the analogy used by Sir Eric Geddes after the war, the taxation of the country was such that it had squeezed the lemon until you could hear the pips squeaking. In spite of the fact that taxation is so high, the Minister comes to this House and asks for further taxation. He referred then to the decline in agricultural and other prices and to events outside this country which had in various ways affected the trade of the country and produced the position in which there is a considerable decline. These are the kind of vague phrases we are given in debate as reasons without any attempt to analyse the situation such as it is. He did not tell us what everybody who studied the question foresaw, namely, the fall in agricultural and other commodity prices. He was told in this House, and he himself must have known it from elsewhere, from a distinguished economist, Keynes, as far back as 1926 and 1927, that the effects of carrying out the Cunliffe Report would be a reduction of credits, a reduction of the rate payable on overdrafts, and that an actual reduction of the quantity must produce the result of making industries slow down and creating unemployment and thereby lessen the market. Obviously that was the market that we had for our agricultural produce and so the prices went down. I am now talking of things that everyone has talked of, and about which pamphlets and books were written three or four years ago. Yet the Minister cannot even bother to tell the House what is the cause, and the reason is because obviously if he gave us the cause he should also attempt to show us what the remedy was, and if he had done that he would have to slip into proposing the policy of the Fianna Fáil Party. It would mean that if he dealt with the matter properly he would have to show how he proposes now to remedy the lack of market for Irish farmers by creating such a condition of things in this country by a tillage policy, by a protection policy which would increase the purchasing power of the people in Ireland, and would give to the farmer a market at first so that he would only have to rely on outside markets after he had the home market as his basis of operation.
Again he says the anticipated estimated tax revenue of £21,220,000 which I gave in the budget speech will not be realised. At that time speakers on these Benches and I myself amongst them told the Minister that he should have anticipated a decrease, due to the fact that the dividends on English shares had gone down so much. It was a perfectly obvious thing which he should have taken into account. Again he says of course it is impossible to estimate what effect may be produced by any changes in the price levels. There is a confession of futility on the part of the Minister. What is the Government for if it is not there to protect the public and national prosperity? He could have established a Tribunal of Prices. He could have established what was recommended by one of the members of the original Currency Commission, a central bank giving the opportunity and machinery for establishing the principle of a separate currency for this country or of at least knowing where we stood from day to day. He could have gone in for a tariff system by which he would have been able to know what exactly his home markets were. The Minister who comes to this House to guess is not carrying out the work of Government, because it is not the work of the Government to guess what the economic conditions of the country should be. It should be its duty to create these conditions, and the Government that does not create proper conditions in the country is no Government at all. He makes a brave assumption then. The price levels are going to remain, although first of all he suggests he is not able to estimate what is going to happen to those price levels. He started out to assume that these price levels are going to remain, and he says I am now in the position that I must estimate that on the present basis of taxation the revenue will be short by £900,000. He did not seem to be aware that his previous sentence had knocked the bottom out of all his proposals and that he comes to this House casting a doubt upon his own estimate, and then proposing an estimate to us for our acceptance. He is simply taking us for a walk in black darkness in a very dangerous country. Then he says that the decline in the revenue is not all due to falling consumption here; in fact the greater part of it is due to other factors—to trade factors or things that have caused a reduction in stocks in the hands of the brewers. Other factors! But he never attempted to explain what the other factors were. He did not tell us that this decline is largely due to the fact that he has rejected all of the economic principles of Arthur Griffith by which he would know exactly where he stood in a market over which he would have a control and where he would know exactly what the factors were when estimating his Budget.
He speaks in a vague way of the cause of the reduction of the stocks of the brewers. Apparently he did not make any inquiry why these reductions were made. He suggests that they were not made because there was a decline in consumption but for other mysterious reasons. What are the other mysterious reasons? Is there a shortage of raw material? Such a suggestion would be laughed at by anyone. Is it not perfectly obvious to the Minister that there has been a steady decline in the consumption of beer and spirits since 1924, and that the total decline between 1924 and 1929 was £2,000,000? A decline of that sort can only be due to one cause, namely, that taxation is so high and the people so poor that they reduce their consumption of these liquors. It would have been dangerous for the Minister to have followed that line, because he would have simply indicated that his Government had been responsible for the continuous decline in the prosperity of the country. In one case, at least, he takes his courage in his hands and makes a direct admission that the fall in the spirit duty is due to a decrease in the consumption of liquor, due directly to the more stringent economic conditions in the country. Then he contradicts himself by saying that they have to anticipate that this abnormal fall in beer duty can hardly recur next year, that the beer duty will be up. Later, he says that the special financial stringency is going to be reflected in a sharp decline in the consumption of alcoholic liquors. He did not wish to face a deficit in the Budget in the coming year, and that is the reason he gives for bringing in this Supplementary Budget now.
The Minister proceeded to discuss the question of credit. "Credit," he says, "is a thing which has no permanency in itself." Certainly it has no permanency in a State based on the economic conditions that this State is based upon. I suggest that he would find a much more permanent and a sounder basis of credit in the Encyclical of Pope Pius XI on Social Order, where he quotes the previous Encyclical of Pope Leo XIII and says: "It is only by the labour of the workingmen that a State grows rich." The credit of a country depends on the output of the country and the consuming power of the country. In other words, it depends on the solid basis of the prosperity of the workingman. It is not like the basis of that State which is slavishly followed by the Minister.
The basis of English credit is a financier's basis which has been maintained by the sacrifice of the British workingman, by the sacrifice even of British industries, and incidentally by the sacrifice of Irish farmers who have their markets in England. It is purely a financier's basis of credit. The only test which the Minister applies as to whether the credit of this country is good or not is whether the heavier investors of money are going to gain a benefit or not. There is no regard in his mind as to the condition of the people, no regard as to the amount of emigration or unemployment, which is the real test of the prosperity of a country and the ultimate test of the fabric of credit.
Deputy Anthony took his former leader, Deputy O'Connell, to task and lectured him because he said we were the slaves of an economic system. He said that if Deputy O'Connell had stated that we were the slaves of a world economic system it would have been all right, but apparently what he objected to was bringing that principle home to us here; what he objected to was that we should suggest that we are the slaves of a British economic system, which is exactly what we are. It is because the Minister and his Government have allowed those powers that control British credit to ring the changes upon currency and credit that Irish farmers and workers are slaves upon the land and hardly able to make ends meet. It is because he has not made any attempt to establish an independent scheme of credit, with a proper economic system of our own, that the British economic system places us under a slavery from which at present there is no escape.
The Minister for Finance makes an interesting admission. He says that the failure to balance the Budget would immediately be reflected in some unwillingness to accommodate us on the part of the banks, in some determination to make the period of any accommodation as short as possible, and in some increase in the amount of discount rates which would be charged. The Minister has an adroit way of pussyfooting certain unpleasant facts across this House. If it were not for the fact that we all remember the episode when he told the banks that he had another shot in his locker, and was afterwards made to climb down to them, we might have passed over that passage without noticing it. One would imagine that after that lesson— and I have considerable sympathy with the Minister in the knock he got at that time—he would have taken some action of determination that that episode of the shot in the locker would not occur again. Again I refer to the establishment of a central bank by which he would have made sure that he would not be made a tool or pawn of any set of private interests, no matter how admirable they might or might not be, that the interests of this State should come first and that to these private interests at least we should not be subjected.
Apparently, the reason for this Budget is largely that the bankers are holding the Minister for Finance up. There has been a good deal of talk in this debate about going on to the gold standard and going off it. When Britain got back to the gold currency, we heard very little from the Ministerial Benches about gold currency being clotted nonsense. It was the God-given policy of the country then, simply because Britain had adopted it, although some of the best of the economic thinkers in Britain were deprecating the fact that Britain was going back to the gold currency. Now the Government have wakened up and discovered that the gold currency is a most deleterious currency, the chief reason being that because Britain went off the gold currency the policy which she pursued must be right. Nobody on the Ministerial Benches has tried to argue the matter on its merits. Nobody has discussed the advantages and disadvantages consequent on our being dragged in the wake of Britain—on to the gold currency when Britain went on and off it again.
The Minister for Justice referred to the fact that European countries had had to come off gold currency and he said that Denmark was left with some £6,000,000 of gold on her hands. The Minister did not tell us who owned that gold, how far it was hypothecated. He did not tell us that in Sweden the gold is not owned by Sweden. He did not tell us that whatever gold passed from Ireland to Britain during the war belonged to Ireland. He did not tell us that when Britain went on to the gold currency again and the Government here approved of that policy, they did not make any attempt to get back the gold which had gone out of this country. Now that the country has gone off the gold standard, they explain their inaction by saying that a gold standard is no good. Their whole attitude on this question is one of sheer opportunism. They are following slavishly in the way of England. We have an example of that in an interview given recently by the President in which he declares that Ireland is not ready for separation, in which he declares to the world that Ireland is not capable of acting like any of the nation-States of Europe, that it is neither capable nor competent to be as independent as Norway, Sweden, Denmark, Holland, Portugal, Greece, Belgium or any of the countries of similar size to Ireland. He says that "to be independent would mean the assumption of an appalling number of responsibilities which we are not yet ready to cope with." If the Government is not ready to cope with these responsibilities, it should get out of office. It has not got the first inkling of what the attributes of a nation are.
The President of the Executive Council says: "For instance, there is the necessity of maintaining our exchange, of maintaining a navy, building up markets for our goods, and the consequences of having to combat tariffs." What is wrong with maintaining our rate of exchange? Would it not be better to maintain our rate of exchange than to be dragged at the tail of a country which is going into a state of rapid decay? I remember reading an article a considerable time ago which must have been available to the Minister's advisers. It appeared in the "Bankers' Review" and was written by Professor Busteed. He pointed out that a rate of exchange in itself is not injurious to a country but is a very valuable thing. It does not affect the essential conditions of a country, but it establishes a barometer by which you know, from day to day, what is the position of your country in respect of trade and manufacture. The President of the Executive Council is afraid of a barometer.
The President says that there is the question of maintaining a navy to be considered. I suppose this country is sufficiently rich, if properly ruled, to be able to act in respect of a navy in the same way as other countries of similar size, and with a similar national revenue. We do not aspire to conquer the world, and we are not afraid of the Japanese or of any other people coming in to capture Ireland. We are not better or worse off than other countries of the same size. As regards the question of building up markets for our goods he who sat at the feet of Arthur Griffith for many years is afraid to assume the responsibility of building up a market in Ireland for Irish goods. He refers to the combating of tariffs. Will he not have to combat tariffs in any case, with the present Government in power in Britain? Are not they a tariff Government, and what position are we going to be in if we do not set ourselves the task of organising our economic conditions on such a basis that we will be affected as little as possible by the tariffs in Britain? Surely that is the responsibility of the Government. No Government can shirk that responsibility. If it does, we must assume that we are to follow in the wake of England and accept every tariff they put on, whether it does us good or not.
It was generally accepted by those who spoke from the Government Benches that there were no exceptions to the so-called world crisis. Yet we have in France a country in which the Budget was balanced so effectively that it was possible even to reduce taxation. Similarly in Italy. Because these countries are self-contained and because they have exactly the kind of policy which we, on these benches, advocate—a policy of protection which will make Ireland self-contained— they have been enabled to do this. It was interesting to hear the Minister for Justice denouncing our suggestion and saying that higher civil servants should not have any reduction in their salaries, having regard to the recent protest made by the chief axe man in the Government Departments, the chief official who was responsible for cutting the salaries of the lower civil servants. But, when the suggestion was put up to him, he took very effective measures to protest against any cut in his own salary or in that of the higher officials. The Minister for Justice did not tell us that when he was attacking us. He misrepresented our suggestions because he only mentioned a few of them. He did not cover the whole ground of our suggested economies throughout the whole organisation.
I would like to repeat a suggestion I made before in reference to the administration of the Customs and Excise. There, I believe, there could be a considerable cutting down amounting to £50,000 a year. It might be necessary to have a proper inquiry into the matter, but at present that Department is organised as it was in the British time. It is on a British basis. There are crowds of inspectors and of the more highly-paid officials whose work overlaps, who could easily be dispensed with so far as that Department is concerned. What is true of that Department is true of many other Departments. If a real cutting down was to take place on business lines it should be done by the inquiry which was put forward as a suggestion from these benches, so that all the Departments will be run on proper economic lines, so that you would get a full day's work for a full day's pay from all Government officials, a thing which, I am sure, no loyal official would in the least object to.
Perhaps it was anticipated that no debate would have taken place on this measure if the Government's plan had worked out properly, and if they had succeeded in exasperating the Fianna Fáil Party into walking out of the House; but the debate has taken place and the country is learning the truth as to how this Government is conducting its affairs. The present episode beginning with the Public Safety Act and continuing with this Act, instead of strengthening the position of the Government, is going to make it far worse than it was and to make its early defeat inevitable.
The introduction of this supplementary Budget is but the natural result of the continued extravagance that has taken place in all Government Departments and of the continued grinding down of the farming community who are the people in this country who will have to bear the whole lot. It is only what one could expect from a Government that has refused to give the farmer any help or assistance to bear his burdens. We have come here repeatedly and appealed for protection for the farming community against those who have no rent or rates to pay here, but who are enabled to come in here and compete with our farmer in his own market. In view of that is it any wonder that something over 150,000 acres of land have gone out of tillage in the last three or four years. The result of that has been that thousands of agricultural workers have to seek home assistance, that they are forced to go into the towns where there is already too much competition and compete for whatever employment is going. Two years ago I made an appeal to the Minister for Agriculture for a tariff on oats. His answer was that instead of a tariff being a benefit it would be a positive harm to the agricultural community. The same statement was made last year when a tariff on oats was also refused in this House. We have a Minister for Agriculture whose policy for agriculture could be carried out here without any land at all. It could be carried out if you had in this city five or six big yards, bought bullocks, drove them in and fattened them on foreign stuff and then sold them. That is the policy of our Minister for Agriculture. He said last week that a tariff on oats would not make twopence difference to our farmers. At the same time the immediate effect of the tariff was to put up the price of oats to the full amount of the tariff—£2 10s. a ton.
This year the Tariff Commission considered an application for a tariff on oats. They left the position clear enough for the Minister. If he had cared to come back from his holidays one month earlier than he did and had then put on the tariff that was put on last week, the benefit to the farmers in the County Cork would have amounted to £37,000. Of course, that these farmers should have suffered that loss is nothing to the Minister. It was far more important for the Minister to take his holidays. If the tariff had been put on last year the benefit to the farmers in the County Cork would have amounted to £100,000. That calculation is made on the amount of oats grown in the County Cork this year. The acreage was 103,000. The lowest estimate of the amount sold up to last week was 25,000 tons. If we take it that the tariff resulted in the price jumping to 30s. a cwt., that means that the farmers in the County Cork have suffered a loss of £37,000 because the Minister would not come back from his holidays a month earlier than he did and spend a day here putting the tariff through.
The Minister had the same answer for the House when he was asked to put a tariff on foreign malt. He absolutely refused to do that. Taking the quantities of foreign malt imported in the last twelve months, the Minister's refusal resulted in a loss to labour alone in the 26 counties of £133,000, the difference between the price of the foreign barley brought in and the price of the foreign malt brought in. The Minister can get the returns and make the calculation for himself. In spite of all that, this is the Government that tells us that we are not practising a policy of economy but one of drift. But they themselves turn around and pay enormous salaries to every Jack, Bill and Harry that they jumped into positions, bribed by big salaries to vote for them and to support their policy in regard to the Treaty. Promises were made wholesale. Individuals were brought up from all over the country and shoved into big positions. It was pure wholesale bribery. It cannot be called anything else. During the last eight years they have prevented any cut being made in the big salaries paid to these people. The Government get up and they say that the country is prosperous, because I suppose they were enabled this year out of the unfortunate tax-payers' pockets to bring every single individual from the Freemasons' Lodge in Molesworth Street to the Governor-General's Garden Party.
That is the sign they give of the country being in a prosperous position. But they ask the unfortunate farmers of the country to pay for that. That is the condition of things that we have existing here the whole time. This year when the Minister for Finance brought forward his proposals for partial derating he put a tax of £300,000 on the sugar that the poor people of the country are obliged to use.
I pointed out to him that on page 4 of the Estimates he would find that he is paying officials in this country, with salaries of £400 and upwards, cost-of-living bonuses amounting to £360,000. Fancy an official in this country paid out of the farmer's pocket a salary of £1,500 per annum getting £4 a week as cost-of-living bonus. That is the policy of the Executive, which comes before us now to propose further taxation on the people. They were not satisfied with that or with preaching that policy here. I have here a list of letters written by that little Napoleon, the Minister for Local Government, down to local bodies. They are gems in themselves. Some time ago we succeeded in getting a sworn inquiry into the salary paid to an official of the Co. Cork Board. The Local Government Inspector who came down fixed the salary at £750 to be paid to that one official. A paid official in Cork, the City Manager, who was paid £1,000 a year at that time—I will come to that presently— wrote up to the Minister appealing to him that he should override his Inspector's decision. The Minister, of course, certainly did override his Inspector's decision. The Minister, of salary by £250 a year. The City Manager's salary was likewise increased from £1,000 to £1,200. When we were recasting the County Surveyor's Department last year it took us seven months to fight the Minister on the question of salaries. The decision of the county council would involve three county surveyors, costing in all £1,650. The Minister's letter demanded one county surveyor at £1,500 and three more surveyors at £550 each, a total of £3,150. After five months fighting him we succeeded in getting three appointed altogether, one county surveyor and two assistants, at a total cost of £1,800. We succeeded in saving £1,350 in that one department alone. That is the economy of the Minister.
A few months ago, when the question of the appointment of a County Secretary cropped up, we fixed the salary and got a tip-top man for the position, a man whose credentials and qualifications are second to none. We fixed the salary at £700, rising to £900. We got a letter from the Minister, who suggested as appropriate an inclusive salary of £1,000, rising by increments to £1,200. That is the economy platform. That is the manner in which not alone do they scatter money themselves, but they endeavour to get local bodies to scatter it as well. Last month the County Board of Health wanted to appoint dentists, and they fixed the salary of the dentists at £5 5s. 0d. a week. They got four applications for the position. They then got a letter from the Minister stating that the appropriate salary for gentlemen with these qualifications should be £7 7s. 0d. per week, and by great pressure the Minister compromised at £6 6s. 0d. per week. That is the manner in which not alone is the squandering carried on here in Dublin, but it is also carried on down the country.
We have the Minister talking here about demands put up here in regard to housing and other matters. The Minister knows very well that at the present day a farmer down the country who spent any more that £500 or £600 on a new house would be considered a lunatic. Here in Dublin we are paying £550 for a lavatory in Dublin Castle. We paid £15,000 for a new barrack for the Civic Guard in Donnybrook. We are paying £16,000 more for a Civic Guard barrack in Cork, and the very least which we are paying for a barrack for these gentlemen is £1,500. We know that when we build houses for doctors in Cork, within three miles of the City, we can erect them, buy the land, put in a water supply, and provide everything else at £1,200 each. In fact, in nine cases out of ten we can buy mansions for them, houses built already, at £700 each. This condition of affairs, this widespread extravagance, is being carried on in order that some Cumann ha nGaedheal Chairman, who has the leg of the Board of Works, can get contracts on the quiet. The whole thing can be done; we know too much about it. That is the manner in which this wholesale extravagance is being carried on here, and there is no attempt whatsoever to remedy it.
We find the very same condition of affairs existing in every single Department, all one welter of squandering and extravagance—extravagance which the country could very well do without. We find £1,550 provided for a Civic Guard barrack in Ballydehob. If the biggest farmer there built a new house that cost more than £200, the neighbours for twenty miles around would come to look at it. That is the kind of extravagance carried on here, year after year by the Government, and there is no use in appealing to them to remedy that condition of affairs. They have not the slightest notion of doing it. We had the Minister for Justice attacking us because we said it was a policy of drift, and immediately switching back the whole debate to try to get back to the old lines of 1922. That was the trouble of the Minister, talking about law and order. The Minister is very well the rival of the gentleman who in his public statement as to how the burning of Cork came about, said that the fire jumped from the City Hall, on one side of the River Lee, into the middle of Patrick Street, on the other side.
If anything is ruining the credit of the country, it is the actions of the Executive during the past two months. We have public bodies all over the country paying money which they can very badly afford, for tourist development, and as soon as the money is spent, we have the cry going out: "That is a terrible country. Every Government T.D. has to be looked after by six Civic Guards." Since the job was done, a week afterwards there was no protection needed for them. Apparently the eleven associations all flew away in one night. Is it not time this condition of extravagance should be remedied? We had the Minister for Justice stating that according as they saw the necessity for a tariff, they imposed it, but the Executive Council, surely to goodness, had as good a way of knowing the condition of affairs in the country and the need for tariffs as we have.
They sit still and wait until a month before the election when they have to face the people again and then they propose tariff after tariff. I am told that Deputy Gorey will get his tariff next week.
In spite of the baboon.
I apologise. I called the Deputy the wrong name, but I could not help it because he has so many names and I could not find the right one. Deputy J.X. Murphy appealed for a reduction in the tax on spirits and is aware that the price of barley is now 14s. a barrel when the taxation is the same as it was when barley was 42s. a barrel. Yet the price of stout has not gone down. Who is profiteering there? Is there not a necessity for a tribunal of prices? A little huckster in Cork or Dublin after four years would be considered very unsuccessful if he has not a house in the country and a motor car. There is profiteering, but the Government will not take any steps to remedy that state of affairs. On these estimates alone the Minister could, without any trouble, save over one and a half millions with very little effort. Of course he has to cater for those who, in their own words, keep the Government in office and cannot reasonably be expected to reduce highly paid officials. He cannot afford any reduction in that line. Since the Government came into office their policy has been to cut the men with 50s. a week downwards. Take even the Civic Guards who got three or four cuts, you would think those individuals would be necessary. The superintendents or the commissioners got no cuts, but were carefully looked after by the Minister. The very Minister who wrote to us demanding an increase of £500 a year in a county surveyor's salary also wrote that the maximum wage to be paid to a man working on the roads was £1 9s. od. a week. That same Minister has the impertinence to bring in fresh taxation and at the same time pay £360,000 a year cost-of-living bonus on salaries of over £400. If the Ministers had any sense of decency they would let a Government come in in the interests of those who have to work and not in the interests of Freemasons.
Before the Minister concludes I wish to make a correction in some figures which I used.
This is by way of personal explanation.
I had to make some hurried calculations. With regard to the income tax, I wish to say that I made several very grave errors. I checked over the figures and I find that the increases due to the additional sixpence about 16.4 per cent. all through the scale. Having said that, I contend that the inequality of the imposition remains. I want to make that clear.
The Deputy cannot make a second speech.
Mr. O'Connell
I wish to make a statement with regard to what I said on the occasion of the introduction of this measure. I see no reason to change my views on the matter. I can appreciate the point which Deputy MacEntee made, that the whole scheme for balancing the Budget should have been before us, but in coming to make a decision as to what line I should take in regard to this taxation, I was influenced by the fact that I know this Ministry so well that I felt quite sure that if they had to find all this money by way of retrenchment I know from past experience the services that are likely to suffer, and I know that the retrenchment would be made at the expense of the social services. That has been the case in the past, and I have nothing to show that they will change their line in the future.
The approximate income of the individuals in this State was given to us at the De-rating Commission in a semi-official way to be one hundred and seventy millions, and the income of the 75,000 income tax-payers is estimated to be about fifty-three millions. That shows that the income tax paying community enjoy approximately one-third of the total national income, and if taxation is to be imposed as part of a scheme of balancing the Budget, I have no doubt that it is that portion of our population, that four per cent. which enjoys one-third of the nation's income, that should be called upon to pay the extra taxation. I quite agree with Deputy MacEntee that the incidence of that tax as between earned and unearned income is not just or fair. I certainly should have preferred to see a greater burden placed on those who have unearned income and a measure of relief given to those whose income is earned, especially those with small earned incomes. It is not possible to do that now. We have made demands on many occasions for it. In choosing between supporting taxation and taking the chance, even of the present Ministry raising the whole £900,000 by way of retrenchment, I am prepared to support the proposals for the increase in the income tax.
The debate has gone over the old familiar ground. I suppose in replying I have also to keep pretty well to the old familiar ground. The suggestions that one gets for economy in the House consist, really, only of two kinds. In a sense they only consist of one kind, because the Fianna Fáil Party suggest economies that would be politically agreeable to them. They suggest economies with a political bias. They suggest practically two sorts of economies, one the cutting down of the police and the army, the other the cutting of certain services or the reduction of expenditure on certain items, such as the Governor-General's establishment, where the amounts realised from them all would be relatively small and not such as to affect the financial situation. To take the money that they suggest we could get would be got if we followed their advice by cutting down the police, and by a serious reduction of the Army, I cannot feel otherwise than that those suggestions are not serious suggestions. They are simply suggestions put forward on the basis of political spite. We have in this country a particular police system which I think is necessary for the country. It might be possible in twenty years from now, under other conditions, to adopt a different system which might be somewhat cheaper, though whether it would be much cheaper or whether it would be sufficiently effective if made much cheaper would be open to doubt. The country being as it is, I think you can have no other system of police than what I might describe as the barrack system, as distinct from the village constable system. The conditions being as they are, taking into account the effects of historical events on the people, I am positive that you cannot substantially reduce the police force here without having this result, that in a few years it will be necessary to increase it again, and to spend a good deal of money on undoing some of the evil effects of a premature and excessive reduction.
Take the mere question of revenue. There are areas where we know it is impossible to root out the manufacture of poteen. If we reduce the police it would be possible for the practice to grow, causing social and moral damage and great loss to the Exchequer—in fact having something like the effect of prohibition in America. If prohibition were fully in force the effects would not appear. It is impossible for us really to take any statistics about the cost of police elsewhere and apply them here. We have got a police force, a system and numbers corresponding to the needs of the country. So far as the Army is concerned, we have reduced it very substantially. There has been over long periods a policy of ruthless reduction of the Army. Immediately after the civil war we had an army costing something like £4,000,000 per annum. We carried out big demobilisations both of officers and men. In fact, at one period it was clear that we went too fast. Even if there were a momentary check, the policy of reduction went on. It has been reduced to a figure that some people on the Opposition Benches once described as a fair figure. But of course any figure when the question of political spite comes in would be too much. If we succeeded in reducing the Army figure to a million next year, the Party opposite would say that of course anybody who had any conscience at all would admit that the proper cost of the Army was not one million, but half a million. If you reduce it to half a million a new situation might supervene when neither the Party on the other side nor the Party here would find it possible to control the situation. The people against whom our recent Public Safety Act was directed might be able to do a great lot of things that they cannot do at present. Apart from any, as I might call them, internal functions of an army, and they are important, there is no use in blinking our eyes to the fact that there is an external aspect. I certainly, for one, am not prepared to have in this country merely an armed police, merely a small body of people who might deal with internal disturbances. I do not know whether we are likely or not to be affected by any sort of world upheaval in the near future. I do not know whether there will occur a war in which our next door neighbours will be involved in the near future or not. It may and it may not be, but I certainly do hold that from a military point of view this country cannot afford to be completely defenceless.
I do not think we can afford, after all the sufferings that the people of this country underwent in order to get control of their own destiny and of their own affairs, to leave ourselves entirely to chance and fortune, entirely to the good-will of our neighbours, when the position should be that nobody need regard our wishes. I know very well that we cannot build up an Army that could resist the British Army. We could not build up an Army that could resist a French Army if it were possible for them to make an attack here. We could not build up an Army that could resist the armed forces of any great Power, if an attack were made. But we are in exactly the position of other small countries in that respect. The Swiss could not resist the French Army or the German Army or the Italian Army, but they do not, because of that fact, deprive themselves of any means of defence. That means of defence corresponds, roughly, to the territory and the wealth that have to be defended.
I think that must always be our position, that we here cannot be neglectful if there is a question of military operations at our doors. I certainly do not want the position to be if some great conflict broke out close to us, that it would simply be a question of British troops coming in and the commander of the British troops ruling this country during the period of the war, and that what the people here wished was entirely a matter of no consequence. I think both for internal reasons and having regard to the possibility that external factors may make it necessary, we must keep an Army here of the sort that we can afford, and an Army that will be sufficient for the purposes. We cannot afford a standing Army of any size. We are gradually transforming our Army from a standing Army, a professional full-time Army to a Volunteer or Militia Army. That process is going on. The standing Army has been steadily shrinking. New militia battalions have been created, and are being created. For instance, last week recruiting was opened at Mullingar for new battalions of the B Reserve. That is a reserve of the militia type, and a start has been made at creating a volunteer reserve on a territorial basis. The process of transformation in the Army is going on. Nobody can say exactly until the process is complete, how cheap or how dear such an army may be. The policy of the Government has been a policy of severely cutting down the expenditure on the Army, and it has cut it down, so far as we can see, to the lowest position possible at the present time. If there were no danger at all of any internal attack on the State, then it would be possible to reduce the standing element still further.
It would be possible to have no permanent force except merely a training force and to rely entirely on the militia and territorial elements; but we have not reached that position, and to reduce the standing force any lower than it is at present time would be to put the country into the gravest possible danger. It would be worse than the owner of some big, valuable factory refusing to pay the premium on his fire insurance in the name of economy. I think that these suggestions we hear from Fianna Fáil for big savings in expenditure—and they are the only ones we hear—are so absurd that I cannot regard any of them as being sincerely or seriously made, but as having their basis solely on history and politics.
This Government has pursued consistently from the beginning a policy of economy and a policy of limiting, so far as it could, the expansion of services. As I said before, there is constant pressure in the House and through the country for new services of one sort or another. The new services may sometimes take the form of derating or a clamour to carry on to the Central Fund things now borne by local funds. They may take the form of widening the scope of the Old Age Pension Acts. There may be demands for drainage and for increased activity on the part of the Land Commission. There are constant demands for increased services, and many of these demands are in themselves perfectly reasonable. The services suggested are services that, if we could afford them, would be perfectly good services. Nobody in the House who looks over the debates can doubt that the demands in the House, reflecting the demands in the country, have been for more and more services and greater activity on the part of the Government. We have resisted these to a very large extent. I do not say that we have not initiated new services; we have and we are bound to do so.
The Fianna Fáil demand has been for more services and more expenditure. They might suggest an economy that would save £1 and a day after they might suggest a new service that would cost £1,000. There is no use in pretending that their policy is a policy of economy and retrenchment. We hear a lot of talk about reducing certain salaries to a maximum of £1,000. These suggestions can have nothing to do with the question of economy. Even if you do carry them out, they do not give any money that would be, in the national balance, of any consequence. You have to bear in mind that economy at the top can easily be wasteful. If you do not get good material at the top, if you do not keep the good material in your service in the service, you can easily have waste that would ten times exceed the economy. I think, generally, too cheap salaries at the top are entirely wasteful. They lead to misdirection, to failure to envisage various problems and to provide for correct solutions.
Civil servants of the higher grades are lower paid than people who have corresponding responsibilities outside —very much lower. Naturally they should be low because there is not the competitive element; there is a degree of permanence and so on that does not exist outside. But for the brains put into his work, for the energy put into it, the Civil Servant of the higher grade gets much less reward than he would get professionally or, with any good fortune, in business outside. We have had people in our middle grades taken away from us and if you had lower scales than we have, and less opportunities, what would happen would be that the best men of those who are in the higher grades would go and we would be left with those who are second-rate, with men who are not of the first quality. The consequence would be that while you might save a few shillings at the top the value of your other expenditure would be tremendously increased.
The idea that you are going to have a Civil Service where there is no place for the first grade man, where there is no career for the man of first-rate quality, is to my mind the most shortsighted policy possible. We can get numerous men who are quite competent for all the ordinary routine work of the service, but it is very hard to get enough men for the hard jobs. When you have some hard job to be faced, when there is some difficult problem to be dealt with, there is no plenitude of men to deal with it; you always have to look around and look perhaps twice before you can get the staff you require for that task.
If we were to pursue what has been described as the Fianna Fáil policy of making a maximum of £1,000 a year in the higher grades of the Civil Service I am certain that a tremendous waste of public money would result because of inefficiency at the top. Inefficiency at the top is just like the slight error at the muzzle of the gun. It may be only one-sixteenth of an inch or one-thirty-second part of an inch, but at half a mile that is a very considerable error. Where you have misdirection and inefficiency at the top, where you have a shortage of first-class brains at the top, then the result is going to be something like the error at the gun's muzzle; you are going to have a tremendous effect on your whole range of expenditure. I have no hesitation in saying that if the policy that has been suggested in regard to that were to be pursued, the results on public expenditure would be such that any trifling saving that might be effected would be lost a hundred or a thousand times over.
It is not at all easy to get good men for a big job in the Civil Service at the salaries we offer. I had an experience just the other day where we offered £1,000 for a professional post and we could not get men with the qualifications and experience required. The men who would have been suitable—and there were a number of them through the country—were already better paid or were enjoying practices which meant that, although there might be some uncertainty that they might disappear and that competition might cut into them, they were nevertheless sufficiently remunerative. At any rate, their practices outside were so good that they would not think of applying for a post at £1,000 a year. The people who talk in this strain, who talk in the name of economy, are people who either are talking with their tongues in their cheeks or else they do not look to see what the conditions are outside. You cannot expect the higher civil servant to be paid anything as great as people in the rough and tumble of competition outside, with the uncertainty that exists in that competition.
But you must provide something reasonable in order to get into your service and retain in your service a fair number of men with first-class brains. There is no use in talking, as I think Deputy de Valera is fond of doing, about public spirit and expecting people to come into the Civil Service in the ordinary days of peace, and work for what he knows is a great deal less, allowing even for risks, than he can get outside. People in times of war will come in and make sacrifices, people in times of emergency make sacrifices, but you cannot expect people to make sacrifices in order that, shall I say, Deputy MacEntee's income tax shall remain sixpence lower than it might otherwise be. It is not human nature that that should be done. There is a sort of public position, and there are security and certain attractions about the Civil Service which come into account in order to lessen the salaries that we pay to the higher men, but when you have allowed for these things, and perhaps allowed for a certain element of patriotism, you must give some salary, taking these other things into account, that will attract the best people.
For instance, for our higher posts, our junior administrative posts, in which young men start at £150 a year and bonus, although the prospects for men entering that grade are known to be very good, and although they lead up ultimately to these posts at the top, we never have got anything like good competition. We have just managed when there has been an examination to get sufficient people for the vacancies who are good enough. If we have three vacancies we can just manage to get three people out of the examination. One would think, and I must say that I thought, we would have perhaps a dozen at the top of the list who are good enough, and that we would be in a position of picking three for the posts. That is not so. Even with present salaries and prospects in the Civil Service, it is very hard to get qualified men. We may only want a few, but it is very hard to get even a few of the best young men of their year out of the colleges here. There has been a good deal of talk about the gold standard, etc. I think Deputy MacEntee made some remarks last week about that which were just as far off the mark as his suggestion about income tax to-day. He described the possible effect of our remaining on the gold standard when the British went off, but in a way that was entirely contrary to what everybody else believes to be the facts. I think if he went back over it he would find it would require correction.
There has also been a lot of talk about a central bank. A central bank would be quite a good thing. We will ultimately arrive at the time when there will be a central bank here. There is no use in talking about a central bank in the way the advertisements used, or perhaps still do, about Dr. Williams' Pink Pills for Pale People, as a cure for all our economic ills. A central bank would not have had any appreciable effect on our position here. With our trade relations with Great Britain, whether we had a central bank or whether we had not a central bank, we would have followed and would be bound to follow the British currency. If British currency were going to collapse like the mark eight or nine years ago, then we might have to make up our minds that, cost what it might, be the inconvenience what it might, we would have to break from it. But, if we do not anticipate that, then the advantages of being level with British currency are so great that no matter what sort of institution we had in the way of a central bank what happened is exactly the thing that would have happened, that is, we would have followed British currency.
Two or three Deputies to-day raised the old yarn about the banks being as it were in some way inimical to the Government of the State and about yielding to pressure from the banks. There is nothing more ridiculous than that. Deputy Little spoke about two statements I made some years ago when there was some matter of difference between the banks and the Government. I made a certain rather stiff statement in the Dáil and shortly afterwards I made a conciliatory statement. I think it is about the tenth time the Deputy has mentioned it. I have not bothered to refer to it before, but perhaps I might as well do it now. He has intimated that some pressure was put on me or on the Government by the banks. The pressure put on me was exactly this. I am speaking from memory, but I am quite clear on it.
A number of people came to me and said: "There is a great deal of alarm among depositors in banks here. They think that there is going to be a big conflict between the banks and the Government, and there are some people who have already taken steps to remove their deposits to banks outside the Saorstát where they think they will be safe no matter what happens between the Government and the banks here." It was because I got well authenticated statements upon that matter that I made a conciliatory statement, not because there was any pressure from the banks or any threats from the banks, but because people represented to me that I was going to do injury to the banks through the inferences that might be wrongly drawn from my words. Let everybody be quite clear about this. The banks are not in a condition even if they had the desire, and I have never seen any signs that they have any such desire, to threaten the Government. They are like every other business that is being carried on in a lawful way here. They are absolutely dependent on the protection of the Government and the maintenance of good order for the purpose of carrying on their business. There is just this about it: that their position is a more delicate position than that of any other trader. The grocer cannot be affected by any panic. No matter what rumours are put out about his credit, if it is any way sound at all he will be all right and he will be able to get his supplies and sell his goods, and he is not in any danger of having to put up his shutters, but the banks, if panic were created, might be faced with withdrawals that would oblige them to take steps which would cause the gravest hardship to many business people who borrow from them and bring about bankruptcies. There is nothing easier, although we have not had any of it here, but we have seen what happened in other countries, than to create a bank panic and to make people who have money deposited in banks think that they will not be able to draw out the money they have deposited when they want to, and once that suspicion arises you will have one going to the bank and then another, and the very terror created which, like a panic in a theatre where people get trampled under foot, will do tremendous and irreparable damage to the State. If I have ever shown any tendency to be what some Deputies would say is over considerate to the banks, I did it not because there was any pressure from the banks or that there was any reason to fear the banks, but because the banks are an essential part of the industrial and economic machinery of the country, and an injury to them would be injury to all who do business with them and to the whole economic fabric of the country.
Deputy Little thinks that the Government expected, or in fact wished, Fianna Fáil Deputies would walk out of the Dáil and shake the dust of the House from their feet when the Constitutional Amendment Bill was under consideration. I assure the Deputy that nothing was further from our thoughts. I admit I did expect that possibly some of the Fianna Fáil Deputies might feel themselves called upon to indulge in a little disturbance which would lead to their suspension from the House for a period of seven days, but that was the most I expected to happen.
We do not even oblige in that.
I would regret that even that should have happened, but that was the most I expected. As a matter of fact my private view is that a great number of the Fianna Fáil Deputies were not at all sorry to see the Bill passed; that a great number of them are sensible enough and have progressed enough along the constitutional road to be very glad that measures were taken to put a stop to people who were still pursuing the revolutionary and a gun policy in the State.
Question —"That the Bill be now read a Second Time"—put.
The Dáil divide d: Tá, 81; Níl, 46.
Tá
- Alton, Ernest Henry.
- Anthony, Richard.
- Beckett, James Walter.
- Bennett, George Cecil.
- Blythe, Ernest.
- Bourke, Séamus A.
- Brennan, Michael.
- Broderick, Henry.
- Brodrick, Seán.
- Byrne, John Joseph.
- Carey, Edmund.
- Cassidy, Archie J.
- Dolan, James N.
- Doyle, Edward.
- Doyle, Peadar Seán.
- Duggan, Edmund John.
- Egan, Barry M.
- Everett, James.
- Finlay, Thomas A.
- Fitzgerald, Desmond.
- Fitzgerald-Kenney, James.
- Gorey, Denis J.
- Hassett, John J.
- Hennessy, Michael Joseph.
- Hennessy, Thomas.
- Hennigan, John.
- Henry, Mark.
- Hogan, Patrick (Clare).
- Hogan, Patrick (Galway).
- Holohan, Richard.
- Jordan, Michael.
- Keogh, Myles.
- Law, Hugh Alexander.
- Leonard, Patrick.
- Lynch, Finian.
- Mathews, Arthur Patrick.
- McDonogh, Martin.
- MacEoin, Seán.
- McFadden, Michael Og.
- McGilligan, Patrick.
- Mongan, Joseph W.
- Clancy, Patrick.
- Collins-O'Driscoll, Mrs. Margt.
- Conlan, Martin.
- Connolly, Michael P.
- Corish, Richard.
- Cosgrave, William T.
- Craig, Sir James.
- Crowley, James.
- Daly, John.
- Davin, William.
- Davis, Michael.
- Doherty, Eugene.
- Morrissey, Daniel.
- Mulcahy, Richard.
- Murphy, Joseph Xavier.
- Murphy, Timothy Joseph.
- Myles, James Sproule.
- Nally, Martin Michael.
- Nolan, John Thomas.
- O'Connell, Richard.
- O'Connell, Thomas J.
- O'Connor, Bartholomew.
- O'Donovan, Timothy Joseph.
- O'Hanlon, John F.
- O'Higgins, Thomas.
- O'Leary, Daniel.
- O'Mahony, The.
- O'Reilly, John J.
- O'Sullivan, Gearóid.
- O'Sullivan, John Marcus.
- Reynolds, Patrick.
- Rice, Vincent.
- Roddy, Martin.
- Shaw, Patrick W.
- Sheehy, Timothy (West Cork).
- Thrift, William Edward.
- Tierney, Michael.
- Vaughan, Daniel.
- Wolfe, George.
- Wolfe, Jasper Travers.
Níl
- Aiken, Frank.
- Allen, Denis.
- Blaney, Neal.
- Boland, Gerald.
- Boland, Patrick.
- Bourke, Daniel.
- Brady, Seán.
- Briscoe, Robert.
- Buckley, Daniel.
- Carty, Frank.
- Clery, Michael.
- Colbert, James.
- Cooney, Eamon.
- Corkery, Dan.
- Corry, Martin John.
- Crowley, Fred Hugh.
- Crowley, Tadhg.
- Derrig, Thomas.
- De Valera, Eamon.
- Fahy, Frank.
- Fogarty, Andrew.
- Gorry, Patrick J.
- Goulding, John.
- Harris, Thomas.
- Hayes, Seán.
- Houlihan, Patrick.
- Jordan, Stephen.
- Kent, William R.
- Killilea, Mark.
- Kilroy, Michael.
- Lemass, Seán F.
- Little, Patrick John.
- Maguire, Ben.
- McEllistrim, Thomas.
- MacEntee, Seán.
- Moore, Séamus.
- O'Dowd, Patrick Joseph.
- O'Kelly, Seán T.
- O'Leary, William.
- O'Reilly, Matthew.
- Ryan, James.
- Sexton, Martin.
- Sheehy, Timothy (Tipp.).
- Smith, Patrick.
- Walsh, Richard.
- Ward, Francis C.
Tellers:—Tá: Deputies Duggan and P.S. Doyle; Níl: Deputies G. Boland and Allen.
Motion declared carried.
Committee Stage to be taken on Thursday, 12th November.