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Dáil Éireann debate -
Wednesday, 18 May 1932

Vol. 41 No. 14

Customs Duties (Wool and Worsted). - Financial Resolution.

(1) That the following provisions shall have effect in relation to the duty on woven tissues made wholly or partly of wool or worsted imposed by Section 1 of the Finance (Customs and Stamp Duties) Act, 1929 (No. 5 of 1929), as varied by subsequent enactments and varied and extended by Orders made under the Customs Duties (Provisional Imposition) Act, 1931 (No. 38 of 1931), that is to say—
(a) the said duty shall not be chargeable or leviable on any woven tissue made wholly or partly of wool or worsted which is imported into Saorstát Eireann after the 18th day of May, 1932, and at importation forms part of a composite cloth which or any part of which has, before importation, been subjected to the process of proofing;
(b) whenever the Minister for Industry and Commerce is satisfied that any woven tissue made wholly or partly of wool or worsted is required to be imported into Saorstát Eireann by a manufacturer of hats and caps for use in the manufacture in Saorstát Eireann of hats and caps or either of them, the said Minister may issue to such manufacturer a licence to import, subject to such conditions and restrictions as the said Minister shall think fit to specify in such licence, woven tissue made wholly or partly of wool or worsted or any particular class or classes of such woven tissues, either without limit as to time or quantity or with such limitations as to time and quantity or either of them as the said Minister shall think fit to specify in such licence, and whenever any such licence is so issued the Revenue Commissioners may, subject to compliance with such conditions as they shall think fit to prescribe, admit without payment of the said duty all woven tissue imported under and in accordance with such licence or repay any such duty paid on such woven tissue;
(c) whenever the Revenue Commissioners are satisfied that any woven tissue which, but for this provision, would be liable to the said duty either
(i) is of the nature of blanketing or felt and is suitable for and intended solely for use in an industrial process other than the manufacture of blankets, rugs, personal clothing, or wearing apparel, or
(ii) is blanketing imported for use by the importer in the manufacture by him in Saorstát Eireann of personal clothing or wearing apparel for exportation under a contract providing for the supply of such blanketing to such importer for use in such manufacture,
the Revenue Commissioners may, subject to compliance with such conditions as they may think fit to prescribe, permit such woven tissue to be imported without payment of the said duty or repay any such duty paid on such woven tissue.
(2) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).
I move these motions together as they all relate to the same thing. The first is a motion to confirm and approve of the Customs Duties (Wool and Worsted) (Provisional Imposition) Order, 1932. That is an Order which imposes a customs duty upon wool and worsted cloth under 2s. per square yard. The second is a motion for the approval of the Customs Duties (Wool and Worsted) (Provisional Variation) Order, 1932. That is an Order which increases the customs duty upon wool and worsted cloth over 2s. per square yard up to 45 per cent., with a preferential rate of 30 per cent.
The Financial Resolution is one designed to give effect to certain decisions which were arrived at when the decision to increase the duty on wool and worsted cloth was made but which could not be given effect to in the provisional order. It is designed first of all to exempt entirely from the duty imposed in 1929 cloth which is made wholly or partly of wool and which forms part of a composite cloth which before importation has been subjected to a process of proofing. There are certain classes of cloth, waterproof cloth, required by the waterproof clothing manufacturers. It is not and cannot be made here. That cloth has been subject to the duty since 1929. It is now proposed to remove that duty entirely.
The second proposal is to exempt from the duty imposed in 1929 cloth required by hat or cap manufacturers for their business. Certain types of very light cloth are used by cap manufacturers. That cloth is not made here and there is no manufacturer here proposing to make it. It has been subject to duty since 1929 and it is now intended to remove that duty entirely. The three Resolutions constitute the proposals which we are submitting to the Dáil for the further development and protection of the woollen and worsted industry.

I find it very difficult to debate the Financial Resolution, a copy of which I got only within the last five minutes. I would like, however, to make a technical point in connection with it. This is being introduced by way of a modification of an Order previously made. It is joined up with a modification of an Order previously made, but it is not itself to be considered as a modification of an Order. Under what legislation is it introduced? Is it under provisional imposition legislation or by way of procedure in accordance with ordinary finance?

By way of procedure in accordance with ordinary finance.

If that is so, why have it joined up with a proposal in regard to certain accessories of cap-making which were certainly the subject of a modification of an Order originally made? Why the mixed procedure?

I am not quite clear as to the Deputy's point. The duty was imposed by the Finance Act of 1929 and it is intended to remove that duty.

But it has appeared in another Order that came before the House.

Surely the Clothing and Apparel Order previously made was modified?

No. The modification made related to non-textile parts of caps.

This is different?

This is different.

On the general resolution, apart from the amounts in question, the main effect of Nos. 2 and 3 is to remove entirely the exemption limit under which certain clothes used to come in free, and raise the old duty previously imposed upon those items of woollen manufacture which were previously chargeable at some rate. With regard to the exemption which is now being done away with, I would like to get some information. First of all, has any investigation been made as to the possibility or the probability of getting manufactured in this country the type of cloth which is being exempt from duty? I would like to know what is the remote prospect—I do not think there is any probability— of getting made in this country the very cheap material which, at the time of the original tariff application, the manufacturers of woollen cloth were disposed to have completely exempt from duty on the grounds, (1) that they did not make this material, (2) that they would not turn the machinery to such a product as it was of an inferior class, and (3) that it would entail a very big amount of capital expenditure to turn their machinery over to the production of what they described as this very low-class stuff.

It will be remembered that when the Tariff Commission first considered this application—or the first application that came before it for a duty on woollen cloth—they said they had many meetings of woollen manufacturers and had put before them propositions for the establishment of factories for the lower grade stuff. They told us in their report that they had not got any satisfaction from the woollen manufacturers on that point. They wound up, when they were recommending a tariff on certain grades of cloth, with the recommendation that the woollen manufacturers should be pressed to consider the establishment of a factory on co-operative lines for the manufacture of such cloths as individually they did not desire to make. The tariff was imposed and there was a certain exemption limit fixed. The point at which cloths were to come in free was later raised and the statement made on that occasion by those who objected to the raising of the exemption point was that woollen manufacturers were quite prepared to go into the low-class business—the manufacture of lower grade cloths.

And the answer made, in opposition to that statement, was that no guarantee could be got from any of the woollen manufacturers, either individually or as a group, that they would say they proposed even to go into that class of manufacture. The exemption limit was accordingly fixed at a higher point but the promise was definitely held out that if and when the woollen manufacturers showed themselves willing and able to meet the demand for the lower grade cloths then the limit would be dropped.

I have personal experience of the matter because, as late as the last month of last year, I had many conferences with both the woollen manufacturers and the clothing manufacturers trying to bring them to the point that there would be a promise of manufacture within a fairly reasonable time of all grades of stuff in the country, and on that point, I must say, I was met with a blank refusal. I even found the manufacturers of this country unwilling to assent to the idea that, as long as they were unwilling themselves to indulge in this type of manufacture, they would look favourably upon a proposal to bring in from outside firms who might manufacture in this country the goods or the cloths which they said they were not concerned with. In the end, rather reluctantly, and certainly without any enthusiasm, there was something in the way of a blessing given to that proposal. When one turned to the other side of the question and asked the clothing manufacturers what percentage of the cloths which they employed in their businesses was likely to be manufactured at home there was found considerable diversity of opinion amongst the apparel manufacturers, but there was almost complete unanimity as between themselves and the woollen manufacturers that there was a certain grade of ready-made cheap clothing for which the apparel people could not get the fabrics manufactured in this country. The only point of difference was as to what percentage of the entire clothing business these cheap cloths represented. I heard it myself put as high as 60 per cent.—I do not think I ever heard it put lower than 30 per cent.—of the entire business.

I come back again to my original question: what is the prospect of getting manufactured in this country the very cheap grades of cloth, say the grade of cloth which would be exempted from tax if the recommendation of the Tariff Commission in their original recommendations to this House had been accepted and had been kept going, because if there is no prospect of getting cloth of that type manufactured in the country then it is clear that the clothes which are made up of these things are going to be increased in price? There is not the slightest doubt about that. Then there will arise for consideration at a later stage the question: what percentage of the made-up cloth purchased by the people of this country is going necessarily to be increased in price. I think it will be at least 30 per cent. If it is 30 per cent., or whatever the percentage is, it must be remembered that in its entirety the increase will apply to the purchases made by the poor people of the community, and these will be made either of necessity or choice: because they like an article, because it will wear for a certain period of time, or because it is an article which can be replaced with an equally cheap article after they have got a certain amount of wear out of it. The next point, and the point on which judgment on these exemptions must turn, is what are the probabilities, or what even are the possibilities of getting manufactured in the country all the woollen cloths that are used, particularly what are the prospects of getting manufactured the very cheap cloths that are used up to the 30 per cent. point as has been asserted by the apparel manufacturers in the country?

I rise to protest against the House being asked to deal with these Resolutions now. The Resolutions have been circulated within the last five or ten minutes. Since we came into the House we have been presented with nine separate White Papers. I suggest it is unfair to ask the House to deal with these very important matters without giving Deputies an opportunity of studying them and of seeing exactly what they mean. It may be possible for Deputy McGilligan who held the office of Minister for Industry and Commerce to deal with these important Resolutions at very short notice, and also for the present Minister for Industry and Commerce, but I suggest it is not fair to ask the ordinary Deputy at such short notice to take part in a debate on these Resolutions or to come to a decision on them. I suggest that it is unfair to the House to present it with nine separate White Papers and at such short notice to expect Deputies to deal with them. I protest against it. I suggest to the Minister that unless it is absolutely essential to get some of these Resolutions passed to-day the further consideration of them ought to be postponed.

I think the Deputy is under a misunderstanding. It has always been the practice to submit Financial Resolutions to the House without prior notification.

That has always been the practice. It is necessary that that should be so. These Resolutions will again come before the Dáil when the Bill to give effect to them is introduced. They can then be discussed at length. It is unusual I think to discuss Financial Resolutions at length when they are introduced. Obviously, it would be impossible to give notification in advance of Financial Resolutions. It has never been done.

I would like to remind the Minister that, in making my protest against what is being done here I am only following the good example set by the Minister himself when in opposition.

Not at all.

Yes, on very many occasions.

I cannot quote at the moment.

The Deputy is not going to get away with that. Stick as near to the truth as you can.

What I am suggesting is that we ought to get an opportunity at least of studying the Resolutions that have been put before us. As I have stated if it is absolutely essential that some of these Resolutions should be passed to-day I am quite satisfied. I do not want to depart from what has been the usual practice of the House. What I want to point out is that obviously it would be impossible for Deputies to debate these important Resolutions, which have only come into our hands within the last ten minutes, intelligently to-day.

Resolutions 2, 3, 4 and 5 must be passed to-day.

Very well.

I have already explained to the House that it has been the practice to move Financial Resolutions in this way without prior notification other than the announcement on the Order Paper that a Financial Resolution is to be moved. These Financial Resolutions will come before the House again——

I am aware of that.

—when the Bill giving effect to them is introduced. They can then be discussed at length. It is necessary that the House should pass Financial Resolutions on the day they are introduced. So far as the four Resolutions which relate to the Provisional Orders are concerned, the time limit required by the Act in connection with them expires to-day. The additional Resolution, the Resolution to remove duties, is now introduced for the first time. It also will come before the Dáil again.

If it is necessary to get these Resolutions passed to-day I am satisfied, but at the same time I suggest that we ought to get a little time to consider them.

What is all the talk about?

Four of these Orders have been tabled in the Library since 27th April.

With regard to item 10——

We have not come to that yet.

I suggest that a little more time should be given for the consideration of these Resolutions. We are asked to consider Resolutions dealing with woollens and worsteds, wearing apparel, boots and shoes and knitted fabrics. The sum of money involved represents more than a quarter of a million pounds.

The Deputy, I think, is looking at the wrong paper.

It is the paper just issued to us.

They are not being moved to-day.

I hope the Minister did not advise the President in that matter, in the same way in which he was advised about the deficit. Here is what I have got in the House, anyhow—a printed document, and this is item 10: "Woollens and worsteds, wearing apparel and knitted fabrics, boots and shoes." The estimated yield for this group is £282,000. That is certainly something over a quarter of a million of money, and I want to ask the Minister, in this connection, if he has examined the position in this country thoroughly, in so far as it relates to the production of shoddy. Does he propose to suggest to any group of industrialists in this country that they should set up a mill for the production of shoddy material? I am not suggesting, for one moment, that it would be a bad thing to do, but that there is a demand for this cheaper class of goods is very evident, and, because of its being so evident, the Minister has thought fit to put a tariff on this class of goods. This particular class of goods is bought by the very poorest persons in our community. They buy an article—it may be a suit of clothes for a child, or a suit of clothes for a man—at a relatively cheap price, as the Minister must be aware. We seek to extort revenue to the extent of £282,000 from these poor people, and I want to know does the Minister consider it fair that these Resolutions, to give effect to this tariff, should be put into our hands within the last five or ten minutes? It is not fair, and I protest against it.

Would the Minister say whether this figure of £282,000 was calculated before it was decided to introduce these exemptions, and, if so, what change in that figure this exemption would be likely to produce?

When the Estimate was being made the intention to grant this exemption was taken into account. In any case the difference involved would be slight.

It would be small?

Yes, in any case.

The Minister, in answer to my questions last week, estimated the yield from woollens and worsteds at about £50,000 this year and the yield from wearing apparel £150,000—was that in view of the exemption?

I am not quite clear about that—

It is only an estimate, anyway.

It is only an estimate of my own.

Can the Minister subdivide this £282,000 amongst these particular items?

That is the point we discussed at length the other day. Apparently—

We have not got very far on it.

This is the limit to which it was possible to go to meet the point made in the Dáil when the Budget Resolutions were first under discussion. There is a very large element of estimation in all these figures, but it is considered that that element of estimation is reduced when the items are grouped in that way, and that something approximating to an accurate figure is available. Obviously, that estimate of £282,000 may have been calculated by the Revenue Commissioners or whoever was responsible for calculating it, by taking a figure and saying: "In respect of this figure we may be overestimating to the extent of 50 per cent., and we may be under-estimating in respect of another to the extent of 50 per cent." The two cancel out and give us a figure which is as reliable as can be got showing the yield in this year from the group of duties covered in Number 10.

Could the Minister say how much of that sum of £282,000 would be additional revenue from the boot tax?

Surely it is possible to give some estimate in respect of boots as a separate item. Why are boots mixed up in this estimate with woollens and worsteds, wearing apparel and knitted fabrics? I can understand these being put together, and being estimated together, but surely there are different considerations with regard to the method of computation and prices that would have to be considered in respect of boots as opposed to these other things. I want to get the estimate more clearly for the items we are discussing. I want to clear boots and shoes out of this—

I am afraid I am not in a position to give an estimate. I could give an estimate of my own, but it would be of very little value. I take it that it is the estimate made by the Revenue Commissioners the Deputy is anxious to secure.

There must have been some item. When the £910,000 was estimated it was not estimated just as a global figure. It was a number of additions, and there must have been some item, some calculation, set opposite such an item as boots and shoes. Can we not have what that was?

I suggest that the Deputy should bring that matter up when the Budget is again under discussion. I am not responsible for the Estimate. I did not consider any of these protective duties from the revenue aspect at all when making recommendations to the Executive Council, but we did have to take into account what the importations, despite the duty, were likely to be. The main consideration, however, which operated in respect to them was their protective effect, and the extent to which they were likely to promote industrial development here, and, obviously, the accurate basis of the estimate depends upon not merely a calculation as to the probable importations, but also a calculation as to the rate of industrial development, during the twelve-months period. I think it has been estimated that of this £910,000 at least £500,000 or £600,000 must be considered as revenue which will come in in this year, and not in any other, and to that extent, the production of these goods will be started in the country during the twelve months period.

Might I make this point to the Minister? Speaking from recollection, I think that the amount which came to the revenue from the tariff on boots and shoes last year was roughly £254,000. Can the Minister say what is the estimate for this year in respect of the tariff on boots and shoes? Is it going to be £200,000 or £300,000? How much will the revenue gain or lose on boots and shoes, and how much will come from clothing? Surely it ought not be very difficult to give us an estimate as to whether it will be £254,000, £300,000 or £200,000.

I suggest, sir, that we are getting away from the matter under discussion, and really embarking on questions which arise from the general Budget statement.

My own view is that the revenue from the boots and shoes duty in this year will not vary to any extent as compared with the revenue last year, despite the increased duty.

Therefore we can take it that in the Minister's view——

I am not responsible.

——the amount which the revenue will derive from the tariffs or tax on woollens and worsteds will be £28,000.

£182,000.

There is very little value in the Deputy cross-examining me about that figure. When we come to estimate the possible yield from the boot and shoe duties we are taking into account what I believe will be the probable rate of industrial development here. If certain projects which are in contemplation, or under discussion, bear fruit, there may be a loss of revenue, arising out of the boot and shoe duty this year.

I hope there will.

Would the Minister consider the advisability of segregating these items, because I think I said a couple of days ago, that I considered this a rather ingenious kind of Budget. Would he not consider the advisability of segregating woollens and worsteds and wearing apparel from boots and shoes, and boots and shoes from knitted fabrics? Here they are not segregated.

There is surely a Cabinet somewhere.

There are many Deputies here who might agree and possibly will agree with the tariff on knitted fabrics and so on, but the Minister himself, and I think the leader of the House at the moment, President de Valera, has said that we must swallow the whole Budget or none at all. That puts some of us in a very peculiar position. There are some things in it of which I approve, and other things of which I do not approve, and I would like the Minister therefore, to segregate, as I have suggested, some of these items. Surely we ought to know under the heading of woollens and worsteds and wearing apparel, what is going to accrue from the duty. We should also know what does the Minister estimate will accrue to the Exchequer from the tariff on boots and shoes, and what is to accrue from the tariff on knitted fabrics. These things, in my view, should be segregated so that we would know, under each heading, what was the probable amount that would accrue to the Exchequer because of the tariff. At present we are quite in a fog. We get a round figure of £282,000 and, in my opinion, it is unfair to the House and unfair to the Irish public.

I am afraid that the Minister is right in saying that we are getting away from what is the really important point in the matter under discussion. Whatever further segregation may be made we are told, I think by the Minister, that under woollens and worsteds, we are discussing an estimated yield of £50,000, and under wearing apparel, an estimated yield of £150,000, and we can take it that it is approximately around these figures. But the Provisional Imposition Order deals with perhaps as important a matter industrially as we could deal with. We are dealing with one of our principal industries, the very greatest possible extension of which we would all be very glad to see. At the other end of it we are dealing with the raising of the cost of essential articles of clothing to the poor. It is essential to know where we stand with regard to the policy behind it. Some Ministers say that they are not going to impose tariffs for revenue purposes. As far as I can understand the attitude of the Minister for Industry and Commerce, he would not in this matter impose a tariff for revenue purposes. This perhaps is the kind of business in which it is most important that that policy should be rigidly adhered to because to raise revenue from a tariff of this kind is to raise it from the very poor. For that reason, I think we ought to concentrate upon trying to get a clear expression of the Minister's mind in the matter; that is, what possibility there is of extending the industry over a certain part of the work that is now being covered by the proposed tariff, and what part of the fabrics which would not be covered by this tariff now has he very little hope of having manufactured here. Then I think that part of the fabrics that the Minister has very little hope in the immediate future at any rate of getting manufactured here should be dropped if it is convenient to do it, particularly when so many burdens are falling on the poorer section of the people. I think it would be a more systematic approach to show that we were endeavouring in the best possible way to avoid loading, even temporarily, on the poorer section of the people, in respect of their clothing, a burden that there is no reason except a revenue one for imposing.

There is a point to which I wish to draw further attention. It seems to me that the Minister's answer to me, that these exemptions are going to produce a very small effect on the £282,000, carries a necessary logical conclusion, which I want to know if he accepts. If these exemptions are going to produce a very small effect he must anticipate that the bulk of the part of £282,000 that arises from woollen worsted is going to be paid by the poorer section of the community.

There is not going to be £282,000 secured from the woollen worsted duty.

The part of it which is due to woollen worsted. It seems to be a necessary consequence that that contribution will come from the poorer section of the community. Does the Minister admit that?

Perhaps I might deal with the points raised. When this matter was under consideration I met representatives of every company engaged in woollen manufacture in the Free State. We went into the position with each one of them as to the extent to which he was in a position now, or intended to put himself into a position, to manufacture the cheaper grades of cloth required by the ready-made industry. There are a number of factories equipped at present to manufacture a cloth which would sell at about 2s. per square yard. There are other factories which are proposing to instal equipment to manufacture that, or even cheaper grades of cloth. I propose to have another meeting with the members of the Association at the earliest date at which it can be conveniently arranged for the purpose of discussing with them the position that has resulted from the imposition of the duty and the extent to which they are now, or will be when I meet them, in a position to supply the requirements of the ready-made trade. There is a very low-grade shoddy cloth which none of the woollen manufacturers are likely to produce. Whether or not a new factory for the manufacture of that class of cloth will be established here is a matter which is in some doubt. But the production of cloth at about 2/- per square yard will enable the ready-made clothing manufacturers to put upon the market a suit retailing at 25/- or 26/-. It seems to me that the provision of a suit at about that price is reasonable under all the circumstances.

If the persons who desire to purchase ready-made clothing, desire also to get a full range of patterns, and, particularly, showy patterns, produced in shoddy or cotton cloth, then they will have to pay the duty which is imposed on that cloth. But there will be available for them suits of Irish woollen cloth, not, perhaps, with the same range of patterns, not with the same bloom or finish that some shoddy cloths have, but they will be in every respect better suits, with better cloth in them, and likely to give much better wear, and they will be available at prices which are in or about the prices at which suits are available at present. There are some cloths which can be imported into this country at amazingly low prices. One ready-made clothing manufacturer came to me with a sample pair of trousers of which he was offered five or six thousand at 1/8 per pair. The manufacture of trousers of that class in this country would cost at least 1/6 per pair, so that there was only 2d. left to buy the cloth. It is possible that the cloth was not bought for 2d., but that the trousers involved was the product of a sweated industry in some mid-European country. There is no doubt that the very low-grade cloth which was contained in that trousers was a type which would not be produced here, and a type which we should not allow to be sold to our people, because I am sure that one shower of rain would completely destroy it.

Was it possible to sit down in the trousers?

I could not answer that—I did not try. Since the imposition of this duty there has been a considerable development in the woollen factories here and quite a considerable number of additional hands have been already employed. When the original duty was imposed, it was decided to operate a price exemption limit. There were certain changes made in that limit. It was first 1/6 per sq. yd.; it was raised to 2/6, and then reduced again to 2/-, each change doing a certain amount of injury to firms here. When the original limit was fixed, as I explained last week, certain firms installed machinery and proceeded to manufacture low-grade cloth at about 2/- per yard. The exemption limit was then raised to 2/6 and one of these firms was compelled to close down and the others were very badly hit. The exemption was then reduced to 2/-. But the maintenance of an exemption at all has meant this: that the tariff has been evaded in a most flagrant way. Of the total importation of 6,623,800 sq. yds. of cloth in 1931, no less than 4,995,000 yds. were free of duty. Any price exemption limit lends itself to evasion. In fact the tariff proved almost completely ineffective in protecting the woollen and worsted industry here in consequence of that fact. When it was first imposed, and before the importers learned the technique of evasion, the tariff did some good and employment in the industry increased up to 1,883 persons on 1st March, 1930. Since then it has been continuously falling until it reached 1,537 in September, 1931. A number of firms are now engaged in the installation of new machinery and in the equipping of factories for the production of cloths on a larger scale, and particularly the low-grade cloths, and it is expected that there will be a quite rapid development in that side of the industry in the very near future, and we will be able to meet the greater proportion of the requirements of the ready-made clothing industry. In the future a person desiring to get cheap suits will get cheap suits of Irish cloth, but if he requires heliotrope and blue stripes and all the rest of it in cheap shoddy he will have to pay the higher duty. He will get a good suit of Irish cloth at quite as reasonable a price as the other.

That is what used to be said of the Irish prison clothing—good, warm cloth.

With regard to the exemptions to be made, the exemptions upon cloths for cap manufacturing will permit of a reduction in the price of the caps. That cloth, as well as the non-textile part of these caps, was subject to duty before, but all these duties are now wiped out and it will enable the manufacturer to get his raw material at a lower price.

Similarly the removal of the duty upon waterproof cloth referred to in the Resolution will permit the manufacture of waterproof at a lower price than before. Personally, I am quite satisfied that this duty is one that should be imposed. The woollen and worsted industry is one of the oldest industries here. We had in the past, and we still have, a substantial export trade. The capacity of the Irish mills to supply their export markets in the present conditions will be increased if they are secured of the home market and consequently their increased output will enable them to spread their overhead charges over their larger production. At the same time, in the past they had in fact a very much firmer grip of the export trade than the home market. Competition of various kinds that they were met with here very definitely damaged their position. To some extent the duty imposed by the late Administration helped them in one end of their trade, but the bigger end of their business, which means employment for a larger number of workers, was left unprotected. We are now closing the gap and giving the industry a chance of developing, and I am satisfied it will avail of the chance.

There are some ten factories in the Free State at present engaged in the manufacture of the cheap grades of cloth. These ten factories are either equipped now or are proposing to equip themselves for the manufacture of that cloth, and the capacity of these factories to produce that low-grade cloth will be sufficient to supply the present requirements of the ready-made clothing industry, and that is our justification for imposing increased duties.

At what price per square yard will they be able to supply the cheap cloth?

At about 2/- per square yard.

Will the Minister state when he hopes that the manufacturers will be able to supply the demand of the retail readymade clothing people?

In reply to the Deputy's question, to a substantial extent they are able to supply them at the moment.

At 2/- a yard? I call attention again to the point I made already—to what the Tariff Commission in its Report said in regard to the application made on this matter. In paragraph 60 of that Report, after a certain amount of preamble upon this point, they say distinctly this: "The applicants were examined very closely on this matter"—that is the matter of cheap cloth—"and pressed to give a considered answer. On the question of price the considered decision of the Association was that the manufacture of cloths of the lower grades was highly specialised and that the demand for them in the Saorstát would not render possible their production at prices comparable with those of similar imported cloths." I express the fact that these are the applicants who were speaking. They maintained that the use of such cloth would involve the wearers in ultimate loss and suggested to us that we should consider the sumptuary aspect of the matter on the ground that these cloths, while admittedly low in price, were not really worth the money paid for them; because of the shortness of the fibre they did not resist hard wear and were unsuitable for manual workers, especially those engaged in outdoor occupations. The applicants argued that it was false economy to purchase suits made from these very low-priced cloths, and that the extra wear given by garments made from better cloths more than offset the higher initial cost to the purchaser.

And the paragraph concluded with this: "The applicants definitely stated as an Association that they were not prepared to develop the lower grade end of the industry, and towards the close of the inquiry, in the concluding speech in support of the application, it was announced that they would not ‘press for the inclusion of shoddy cloths around 2/- per trade yard' if the position of such cloths under a tariff was going to be a vital factor in our determination of the application."

Now this is the case they make: (1) "that the manufacture of this cheap cloth is highly specialised, and that the demand for it here is not such as would render its production here economic."

They said they would not go into that end of the trade and stated finally that if that was any bar to the tariff being granted they asked the Tariff Commission to cut out all cloth around 2/- per trade yard. The exemption point was raised and raised specially because the clothing apparel manufacturers made a case which we felt was substantiated on examination of the clothiers' books that about 60 per cent. of the entire apparel business was done in the type of cloths which these people said they would never manufacture.

The Tariff Commission made their recommendation in paragraph 88 of this Report. There is a certain amount of preamble and then they said that the Irish manufacturers ought not to be content to leave the importers the market for low-priced cloths made mainly from reclaimed wool, and they go on: "As already stated we do not anticipate that the reputation of the high-grade Saorstát cloths is likely to suffer because low-grade woollen cloths are also manufactured in the country. If individual mills are reluctant to have their names associated with cloths of this kind it might be again considered by the applicants' Association whether it would not be possible for them to organise a mill for the manufacture of low-priced cloths of grades not likely to compete with the better qualities produced by the other mills."

After that every investigation that they have had with regard to woollens and worsteds has turned on the question that the woollen manufacturers find themselves up against the whole time, the question that was most querulously put by the clothing manufacturers was whether they were prepared now to go into the lower grade end of the industry, or alternatively whether they were prepared to associate co-operatively, and to have a factory started under that auspices for the manufacture of the lower grade cloth and I never heard in my time any suggestions that they were prepared to go into the lower grade end of the trade or to associate co-operatively with such a factory.

What we are faced with now clearly is that the low type of cloth is not going to be made here. I do not care what the Minister says with regard to his belief; there was never anything in the way of enthusiasm shown by the woollen manufacturers for this tariff even when it came down, as it did in my time, to their being asked if they could not get agreement with the clothing manufacturers on the basis that they would in some way or other, by individual firms or by cooperation, get a low-grade cloth manufactured. When it came to that point, they broke and refused to go to the Tariff Commission. Sometimes, they put up the case that this would degrade the name of the Irish woollen manufacturers for high-grade cloth. Sometimes, they put their argument on the other ground—that it was wrong to allow people to buy these cheap cloths. More often they said simply that they were not going to do it but mainly they urged that this was a specialised branch of the industry with which they were not competent to deal. If that is not the position now, I should like to know what change has come about in the mentality of these people.

I have always found that any approach made by a Government or by groups of interested Deputies or parties to this problem was always well disposed towards the cloth manufacturers, because people did realise, on account of its being an old-established industry, one in which we had a fair name and in which we had a fair export trade, that it was likely to provide lasting employment as compared with the more or less ephemeral type of employment given by the makeup business. They were approached in that sympathetic way and it was made clear that such matters as the Minister referred to—ranges of cloth and variety of pattern—were not going to count in the end against them if they could give any firm assurance, upon which a decent judgment could be formed, that they would manufacture cheaper, low-grade cloths. The scales in these circumstances would be weighted in their favour and against the apparel people. Despite that, they never brought themselves to the point of agreeing that they would manufacture this low-grade stuff here. I take it that we are faced with that position still. If not, I want much more precise information as to how many of the factories which the Minister has in contemplation are equipped now for the production of these cloths. I want to find out where the machinery for the provision of these cloths was hidden up to December of last year. I want to know also what the prospects are of the factories which the Minister has in contemplation and which are not equipped for the production of these cheap cloths at present getting the necessary machinery to have these cloths produced very soon. If that is not going to be done, then the poorer classes, and particularly the poorer classes who buy boys' clothing, are the classes which are going to be hit. This cheap cloth is, in the main, used for boys' clothing of a cheap type. That is the net point upon which the exemption point turns. The other matter we will discuss later, because, although it will entail hardship, it will entail hardship on people better able to bear the hardship than the people to whom I have alluded.

We are told—I hope the Minister will take his own sermon to heart— that the changes in regard to this tariff did a lot of harm previously. There have recently been variations and modifications of orders hastily imposed, and I am not sure that they are not doing harm at the present time. There is a great deal of talk about this question of sweated wages. That is an obvious defence where there is no other defence open. It is also a good defence, because the matter is hardly ever brought to the test. When we are told that there is stuff produced by sweated workers coming into the country, and when the Minister metaphorically waves a 1/8 pair of trousers in front of us, he should let us know where these trousers come from and what are the wage conditions in the countries from which they come. There should be an investigation as to the real wage conditions—not merely the amount of wages paid—in order to show that a sweated wage is really in operation. A person here may be getting a much bigger amount in money stated, but when you consider that he is going to pay a little more in respect of the levy on butter and somewhat more in respect of all the other things he uses on which a tariff has been imposed recently, the real value of his wages is going to become somewhat equivalent to the sweated conditions outside. The whole position has been changed by the very sweeping series of impositions brought into force within the last few days. It is hardly a sound proposition for the Minister to advance that he has evidence to warrant his stating that ready-made clothing can be produced here at a reasonable price. I do not think that he should be the arbiter as to "reasonable price." We have got to hear what the price is and what the people can afford to pay. The "reasonable price" may introduce the sumptuary aspect. It may be that it would be much better to make people buy ready-made cloth of double the value of the lower grade cloth sold at the moment. In the end, it would probably give longer wear, give better satisfaction, and stand shaping to a greater extent. But the point is, what the particular person is to buy at the moment in relation to what he has to spend. The reasonableness of the price can only be judged when these things are brought into comparison. At a later stage, we shall have to get some precise figure as to the type of cloths made up at present, and particularly the cloths which the purchaser will be able to buy hereafter in comparison with what he can get at present— leaving out the foreign cloths, the European cloths, and considering what he can get from England at the moment.

The patterns and ranges of cloths I have spoken of. I do not think the House would raise any objection on that score. When I spoke on that matter before, I felt I had the House with me when I pointed out that if it were only a mere matter of reducing the variety of patterns or the range of cloths, there would not be very much complaint. One has to recognise that when the consuming unit is to be smaller the production unit has to decide on the reasonable demands of that reduced consuming unit. Obviously, in these circumstances there is not going to be the same range as there formerly was. Ranges and patterns do not disturb folk, generally. What does disturb them is value in the sense of the money to be paid at a particular time for a particular article.

Why is discrimination made in regard to cap cloth and certain fittings for caps which are to be let in free or at a reduced rate? Why would the sumptuary aspect not come in there for consideration also? Would it not be much better for a man to pay double the price and have the cap made of better cloth? I would reverse the logic of the proposition and make the discrimination also with regard to the cloth manufacturers. The Minister has made a discrimination of one type with regard to these caps, and I should like to know the basis of the difference between them and the other cloths. Exports have been mentioned. That matter we shall have to deal with at much greater length on another stage. The Minister said that we have an export trade. I think we used to have a bigger export trade. Even up to the early part of the year 1931, export was about 50 per cent. of the entire production. Where are we likely to have the export continued to? If we are closing—as I assume this tariff is intended to close—definitely and completely against all goods coming in from outside the British Commonwealth, and very nearly closing against goods that come from the British Commonwealth, where do we expect to get any export trade done? Does anybody think that if we decide to bar and bolt our doors against outside goods, we are going to have the doors of other countries thrown open to us for our exportable surplus of manufactured articles? We have got to realise, if we do impose this tariff, dropping the exemption limit, and refusing to admit except at an enhanced price even the low-grade cloths which we do not make and will not make ourselves, we can hardly hope to have the gate kept open for our own exports. I think we have to take it that the 50 per cent. we used to export will have to find sale in this country. Most of the export trade was done in the very highly finished article. It was the very best cloths we sold, and I wonder do the manufacturers of these cloths view with equanimity the prospect of having to sell these highly finished and dear cloths in this country, whose purchasing power has during the past few weeks been diminished owing to the flood of impositions which have been introduced. These things will have to be considered, if not now, at a later stage. The woollen manufacture is one which has got the best attention of everybody in the country. We are entitled to demand from those concerned with it the very best return. The "very best return" should include that they will either manufacture these goods on their own or see that they are manufactured for them by some group acting in association with them. At the moment, I do not suppose it would be considered a proper thing to have a division on this Resolution, but it will have to be divided on later if a more satisfactory explanation is not forthcoming than was forthcoming to-day.

The woollen manufacturers are in a position to supply cloths at an average price of about 2/- per square yard to meet the total requirements of the clothing manufacturers. I met them and went in detail into the question of the lower-priced cloths. I am aware that some of them are installing new equipment and taking on people with specialised knowledge of the manufacture of low-grade cloths. I am proposing to meet them to see to what extent the position in that respect has improved. I am not as enthusiastic as the Deputy is for the manufacture here of the very low-grade shoddy cloth. If we can produce a suit which can be retailed at about 25/-, I think we will be doing very well. We need not consider the very questionable advantages that might be secured if for 20/- we could get a low-grade suit made out of this reclaimed wool or low-grade shoddy cloth. I think the manufacturers will rise to the situation and I know they are doing it.

The question of the export trade has been raised. None of the other countries which have imposed duties upon imports has done so in consequence of anything that happened here nor are they likely to take into consideration our difficulties when considering the steps to be taken to protect their home markets. The Deputy referred here last week to the growth of economic nationalism throughout the world and he deplored it. Nevertheless, it is there, and we may find ourselves in the position, in respect of industrial commodities of this kind, that we will have to depend entirely, or to a very much greater extent than at present, upon the home market. It is just as well that we should be taking action now which will secure for our manufacturers a breathing space in which they can develop their technique and equipment so as to be able to supply home requirements.

We heard a lot about the price of suitings during the last hour. We have not heard anything about the cost of making these suits. Will the Minister say what it costs to make a cheap suit? It will cost £1 5s. 0d. or £1 10s. 0d.

Does the Minister anticipate having further discussions with the manufacturers before the passing of the Finance Bill?

If it can be arranged.

Can the Minister give any idea of what the cost will be for boys' clothing, ages eight to ten, and ten to twelve, if a man's suit can be sold for 25/-? I understand that a boy's ready-made suit can be sold for 6/11 at present.

I have not looked into that, but I have seen advertisements in the Press of boys' suits of Irish manufacture at the figure the Deputy has mentioned.

Will the Minister tell the House if the advertisements are for suits made from cloth of Irish manufacture, or if made up in Ireland of shoddy imported cloth?

I cannot answer that.

That is the difference.

The Minister stated that he expected the manufacturers were now in a position to meet the demand for these cheap suitings. I would like to ask him if he has any definite assurance from them to that effect. My recollection is that a similar assurance was given a couple of years ago, when some of the changes that have been complained about regarding variations in the duty on this particular cloth were made. If there is not an undertaking other than the undertaking given a couple of years ago then I take it we are in the same position. I do not see that there is any possibility, unless the Minister has an undertaking, of their meeting the demand.

They have assured me that they propose to engage in the manufacture of low-grade cloth to the extent required to supply all the requirements of the ready-made clothing industry.

Resolutions agreed to.
The Dáil went out of Committee.
Resolutions 2 and 3 reported and agreed to. Resolution 8 to be reported at a later date.
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