Deputy Blythe criticised these proposals on the ground that they were childish, ridiculous and absurd. Deputy McGilligan criticised them on the ground that they were not original, that they were similar to proposals which he had submitted to the flour millers. They were both wrong. Deputy McGilligan added, and I should like Deputy Blythe to grasp the significance of it, that the proposals which he submitted to the flour millers were rejected by them. We have been told that these proposals will mean an increase in the price of flour, and a number of Deputies spoke as if the motion before the House involves an import duty upon flour. It does not. There will be no import duty on flour, except persons decide to import flour other than under a licence issued by the Revenue Commissioners. It is intended that all the flour required to be imported, all the flour we need to get from abroad in order to supplement the products of our own mills, and a little more will be imported duty free. We have been told that we are going to increase the cost and, at the same time, that that increase in the cost to the consumer is going to have no result except to confer a benefit upon a small group of inefficient mill owners. I take it that that represents the argument used by Deputies opposite—a big increase in the cost to the consumer, in return for which we are going to get only a benefit conferred upon a small group of inefficient mill owners who, for some reason that has not been stated, are, we are told, opposed to the scheme. Deputy McGilligan asked me if these proposals had been submitted to the mill owners and what they thought of them. They were submitted to the mill owners, and the Flour Millers' Association said that they would much prefer to be left as they are. They are quite pleased with their present position and do not want any change.
What is the present position? Deputies must consider these proposals in relation to the present position. Deputy Blythe talked about a cartel under Government control. There is a cartel in operation now. There is not a free market for flour now. The production of Irish mills is strictly limited. Irish flour millers have to pay a fine if they exceed the quota in operation now. There is a certain limitation upon the amount of flour that may be imported. There are definite regulations governing every transaction in relation to flour used here, whether that flour is produced in an Irish mill, or imported from an English mill, and that system of control is administered by a body partly composed of Irish millers and partly of English millers. Is it more desirable that the flour milling industry and the flour importing industry should be controlled by an organisatition of that kind than controlled by a Department of State? Deputies who talk about the cost to the consumer appeared to take very lightly the additional cost to the consumer which resulted from that organisation which came into existence during their term of office and which they did not interfere with. The price of flour has gone up. Deputy Moane, I think, stated that. The Irish flour millers are making such respectable profits out of this arrangement that they do not want to change. It does not suit them to change this arrangement, because the arrangement designed by flour millers for flour millers is working for the benefit of flour millers. The alternation in the arrangement is going to mean that the flour milling industry is not going to be operated entirely for the benefit of the millers in future, but that the rest of the country is going to get some advantage out of it as well.
There is this essential difference between the system now in operation and the system we propose to bring into operation, that the quantity of flour that is to be imported under the new system will be determined by us. We can permit any quantity of flour we wish to come in, if we find, for example, that prices are rising unduly, and that there is a combination of flour millers to exploit the situation. We can permit in whatever quantity of flour we consider necessary to upset that plan. We cannot do that now. At present, the quantity of flour imported from British mills, whose owners are members of this Association, is strictly subject to limitation, and these English millers, if they proposed to import into this country more flour than they are permitted under the arrangement would also have to pay a fine upon the excess. If this is a scheme to prevent the flour-milling industry here developing upon efficient lines, what is the system we have now in operation? We, at least, are going to give these mills in this country an opportunity of working to capacity which they have not got now.
We have been told that this fine upon excess production that we are proposing to operate means that we contemplate an increase on flour to the same amount. At any rate, our mills will be working to their full capacity. These mills pay a fine upon excess production on present quotas without working to their full capacity. Was it contemplated to limit the increase of price that was to take place when the Association came into operation? Why did not the Government then in office take the necessary steps to protect the interests of the consumer? Their hearts are bleeding for the consumers now, but for two years they saw the flour milling industry here being regulated in that manner, being regulated by an organisation over which they had no control. They saw the price of flour gradually going up. step by step, in consequence of that arrangement and they did nothing. It was only when we decided to end that arrangement, to put the flour milling industry of the country under Irish control, to give it an opportunity of developing to full capacity, and extending capacity to meet all the requirements of the country that they began to consider the interests of the consumer.
What are the interests of the consumer, and how are the interests of the consumer going to be affected by these proposals? We have flour mills here at the present moment, some twenty of them, producing flour to 50 or 55 per cent. of their capacity, and selling flour at a price which they consider satisfactory, at a price which they consider so satisfactory that they are opposed to any proposal to alter the present arrangement. If, instead of producing to 55 per cent. of their capacity, they in the month of September produce to 100 per cent. of their capacity, could we not look for a reduction in the price of flour? Their overhead charges will be the same. Rents, rates, upkeep of machinery will be the same. Consequently, their cost per unit of production will go down. We can, therefore, contemplate a reduction in the price of flour, except in so far as that reduction in price is offset by a reduction in the price of offals. In any case, it is in a downward direction we shall except the price to go. The proposal that any mill producing in excess of the quota should pay a fine of 3/- per sack will, of course, be completely inoperative for some time, because each mill is going to get the quota which represents the maximum capacity, calculated in accordance with a certain formula. It will not be able to produce flour over and above that quota except by working more than the usual number of hours per week or the usual number of weeks per year, or installing additional machinery, which will take a considerable time, in any case. It is necessary that we should have some such fine in operation if the quota is going to have any significance at all. We have got not merely to ensure that the flour-milling industry develops, but also that it develops along the line most conductive to the national welfare. We have, for example, to get flour mills other than in Dublin, Cork and Limerick. If we draw a line through Dublin and Galway, there is no mill north of that line, except one in Sligo. We must get mills north of that line. Consequently, it is necessary to ensure that all the development will not take place in one area or another, and that when we have reached the point where we will have mills enough to produce our requirements, the costs in certain districts are not going to be higher because of heavy transport charges, and, also, it is our desire and aim to keep in existance the inland mills. The inland mill is an essential part of any wheat policy and we have a wheat policy. The tendency in recent days has been to concentrate flour milling at the ports. That concentration of flour milling at the ports would be all right and, in fact, would be a welcome development if we did not contemplate the use of the inland mills again for the milling of Irish wheat. We are going to do that. At present the inland mill has certain disadvantages vis-a-vis the port mill, but these disadvantages will, to a large extent, be offset by the advantage of being able to get their wheat cheaper when Irish wheat is available, or, at least, a certain part of their supplies. I do not, however, want to be taken as saying that all the advantages are with the port mill. There are some millers in this country who appear to be strongly of the opinion that the balance of advantage is with the inland mills. There are, as a rule, lower wages paid to the workers in a country town or rural area than in one of the port cities, because the cost of living is usually much lower. There are, in many cases, cheaper power, lower rates and other advantages which offset the disadvantage of having to pay more for the grain, and, in so far as there is a balance of disadvantage against the inland mill, we are, for the time being, going to redress it by a subsidy arrangement, and, subsequently, by a wheat arrangement. It can be argued, and it has been argued, that the larger inland mill has the balance of advantage as against the port mill. I do not know whether that is so or not, but it seems quite clear that, in respect of the smaller mill, with a capacity of less than six sacks per hour, the balance of advantage is against the inland mill, and consequently, it is intended to limit the subsidy to the annual output which a mill of that size could undertake.
The Tariff Commission Report has been quoted, and, particularly, the statement made by the applicants for the tariff that if the duty of 3/- per sack, which they requested, were imposed, they would increase their price almost by the whole of that amount. That has nothing whatever to do with the proposal before the Dáil. At the particular time when the tariff application was in progress, it was alleged that flour was being dumped here at an uneconomic price, and we know that the Irish mills were going out of production, in consequence of the fact that they could not, no matter how efficient or well situated they were, or what other advantages they possessed, sell flour at the price at which flour could be bought from certain places. Undoubtedly, the imposition of the tariff would have meant some increase in the price of flour, but that increase in price would have taken place in any case, because the English millers, at that time, were engaged in this campaign to put the Irish mills out of existence and an increase in the price of flour would undoubtedly have helped the disappearance of the Irish mills. We are not putting a tariff on flour.
The quotations which were read from the report have no relevance to the motion before the Dáil. The flour that will be imported under licence will be imported duty free and will be sold at the same price and subject to the same profit as it is being sold at the moment, but it is very hard to say what exactly the price of flour is and this is a factor that Deputies should bear in mind, that the price of flour, from week to week, or month to month, fluctuates quite considerably. Up to the date of the establishment of this Millers' Mutual Association, that fluctuation was quite remarkable, but since then the fluctuations were not quite so frequent, because, of course, a situation has been created in which certain regulation was possible, but it is since then that there have been differences in the price of flour in one month as against another, frequently by much more than 2/- or 3/- a sack, and the average miller will tell you that he does not know the average price at which he is selling flour until the end of his accounting year, when he divides his output into his receipts and finds out what his average price was.
No impost on the community follows from the passage of this motion. The intention is to secure that the price of flour will be fixed, not by the three shillings fine on production in excess of the quota, or the 5/- import duty on flour not imported under licence, but by the element of competition which will be allowed to continue. It is our intention that over and above the requirements of the country there should be flour available, either from existing mills here or by importation, in sufficient quantities to ensure that the inefficient mill is going to suffer, and that the efficient mills will be able to make progress, and that there will be effective competition between them all without the importers, and that, consequently, any attempt at profiteering will result, as it should result, in immediate loss of trade.
Deputy McGilligan asked me what was the present capacity of the working mills and what was the amount of flour which would be imported during the month of September. I could not give him even an indication of the amount of flour which would be imported under licence during the month of September. The capacity of the existing mills has been stated by them to be 2,200,000 sacks per year. Taking the requirements of the country at 2,900,000 sacks, we find that only 700,000 sacks per year would necessarily have to be imported, even if none of the silent mills came back into operation, but some of the silent mills will come back into operation immediately the scheme comes into operation. Others will take a longer period, because of the financial difficulties to which I referred, but, with all the silent mills working, the margin between our capacity and our requirements will be very small indeed, and that margin will be closing up at a rapid rate, because already there are certain proposals coming forward for the erection of new mills in particular centres. I could not follow Deputy Fitzgerald-Kenney at all in his remarks about the effects of over-production. We are certainly not suffering in this country from any over-production of flour. Deputy McGilligan referred to the position of Jacobs'. It is intended that Messrs. Jacobs can secure all the flour they need, imported under a licence issued in accordance with paragraph 2 of this motion, without being subject to any importing difficulties whatever.
Some considerable reference was made to the difference in the proposals in respect of mills owned by nationals of the Saorstát and mills owned by non-nationals, those mills owned or controlled by the firm of Messrs. Rank. The intention is to give to each of the mills now working here, no matter by whom owned, a quota to mill to its present capacity, but it is definitely intended that, in respect of mills not owned by nationals of the Saorstát, no increase in that capacity will be allowed. The remarks made by Deputy Bennett, with respect to the position in Limerick, are altogether wide of the mark. I do not think that the development of the flour milling industry in Limerick is altogether dependent on Messrs. Rank. Anyone who looks at a map of this country, and considers the position of Limerick, in relation to wheat growing areas and importing facilities, must come to the conclusion that Limerick is a natural centre for the flour milling industry here, and the possibility of flour milling development in that city can be contemplated without regard to the firm of Messrs. Rank at all. But, definitely, the intention not to permit any increase in the capacity of mills owned by non-nationals of the Saorstát will not be departed from. If that decision should involve the abandonment of the Limerick Harbour proposals to which Deputy Bennett referred, then they have got to go by the board but I would like to make it clear that these proposals were examined from the financial aspect without regard to the intention of Messrs. Rank, and they were considered to be financially sound in relation to the trade which the port had in previous years, and not in relation to any estimated increase of trade following upon any extension in the milling capacity of the city. The decision of the Limerick Harbour Commissioners announced in yesterday's Press seems to conflict with the information supplied to Deputy Bennett.
We are taking under this Bill power to acquire mills which for any reason are not engaged in the production of flour. It is necessary that we should have some such power. If we are to enforce conditions which make the people of this country dependent for their supplies on Irish flour mills, it is necessary for us to ensure that the failure of any particular manufacturer, through any fortuitous circumstance, will not prevent the Irish people getting supplies. Flour is a necessity of life. We might for a period do without boots, or without some other articles which are subject to import duties. We could not do without bread, and if in any circumstances the supply of flour was likely to be curtailed through the shutting down of a flour mill for any reason, it is necessary that we should have power to acquire that mill, and if necessary work it. I can assure Deputy McGilligan that we will be able to get the necessary technical skill to work the flour mills for whatever limited period it may be necessary for the State to work it.
As regards silent mills, I have been asked what are the conditions that are likely to be attached to the licence issued to them when they resume production. These mills have been spoken of as if they were uneconomic. That is perhaps true of some of them, but it is certainly not true of all of them. There are some of them which have closed down for reasons not directly associated with the competition which they had to meet from other sources, and they are equipped and in a position to produce flour as economically as the mills which are at present in production. If a mill is definitely uneconomic, if a mill is unable to produce flour at a price comparable with the price that other mills are doing it, then there is no room for it in this scheme, because, in so far as the quota is given to any mill, the import figure will show a corresponding reduction, and it is necessary for us to see that that mill will produce up to its quota, and produce at a price at which flour would otherwise be obtainable.
Generally speaking, the only conditions likely to be attached to the issue of licences in respect of these mills will have relation to their ownership, and be designed to secure that the ownership will be in the hands of Irish nationals. Deputy McGilligan also referred to the necessity of having some prohibition upon the sale of mills. It is not intended to exercise that power of prohibition in respect of the sale of mills by one national of this State to another, but a mill that is now owned by nationals of the Saorstát may, upon sale to a non-national group, or to a non-national, become liable to the loss of its quota. Definitely the intention there is, irrespective of what the effect may be in other directions, to secure that this industry will not pass under foreign control to a greater extent than it has been permitted so to pass up to the present.
The question has also been raised as to the amount of employment likely to be given. I did not say that no employment would be given, but I said that the amount of direct employment in the mills would be small. A modern flour mill, I explained, does not require very much manual labour. Roughly speaking, 150 to 200 persons are likely to be given direct employment in the mills. It is not a large number, but there will be a considerable amount of employment given in ancillary industries as well. Apart from that, the whole flour-milling position must be considered in relation to the tillage position. If we allow our flour mills to go, we will never find it possible to bring into operation the tillage programme we have in mind. The preservation of an efficient flour-milling industry is an essential part of any tillage scheme. As Deputies are aware, the growing in this country of the amount of wheat we would require to supply our annual consumption of flour would give very substantial employment, employment to more than 20,000 men per annum. It will take some considerable time, if in fact we ever get to the point of supplying all our requirements, but we can go a long step in that direction, and those Deputies opposite who believe or have been advised that it is not feasible or advisable to grow wheat here or to mill that wheat into good flour here are completely mistaken. Not merely is it possible to grow wheat and to grow it in considerable quantities, but some of the best flour-millers in this country are more than satisfied that very satisfactory flour, better in many particulars than the flour now offered, can be milled from that wheat even when that wheat is not subjected to any processes of mixture with any imported grain.
Deputy Norton asked if this proposal was merely the first step in relation to a general wheat programme. I explained in introducing the motion that that was the case. Under this motion we propose to restrict the importation of flour as from 1st September. From that date we will endeavour to get the existing mills to take on the full production. The next step will be the bringing into production again of the mills now silent and the erection of new mills in the districts where these mills are most needed. The legislative proposals which will be submitted to the Dáil in the autumn will provide the necessary means to that end. At the same time certain proposals in relation to our tillage policy will be brought to the Dáil. We hope that next year, in the harvest of next year, there will be much larger areas under wheat than heretofore, and a beginning will have been made towards getting on to the position in which the whole or the greater part of our requirements in flour can be milled in Irish mills from Irish wheat.
I do not know if there was any other point raised to which it is necessary that I should refer except in one particular. The speech made by Deputy Bennett and a certain remark made by Deputy Corry make it necessary that we should clearly understand what the position is in respect to foreign ownership of flour mills. It was suggested that Deputy Bennett had intimated to Messrs. Rank that if they held on for a certain period there might be a change of Government and that they would then be in a position to carry out their original programme. If my information as to the attitude of Deputy McGilligan is correct and if I have read aright the various indications on the files of my Department I do not think that Messrs. Rank would be well advised to give effect to Deputy Bennett's hint. No matter what the Minister for Industry and Commerce does, no matter who is Minister for Industry and Commerce and no matter what is the political situation existing at the time it would not be possible for any conscientious person in that position to watch the developments which have taken place or to study the obvious indications of the policy of Messrs. Rank without being gravely perturbed. I know that Deputy McGilligan was perturbed. I know that before the change of Government took place he was seriously considering whether or not the time had arrived for him to take action. The change in Government took place and in the situation that existed I decided that action had to follow. Having given the circumstances of the case full consideration, I decided that the best course to follow in the present circumstances was to cause the least possible upset while at the same time taking the necessary steps to ensure that the position would not be worsened. Consequently, it was intimated to those concerned in the Limerick and Cork enterprises which are under foreign ownership, that under any flour milling scheme which would be introduced they would be limited to their present capacity and that so long as this Government remained in office there was little possibility of their being allowed to extend beyond that capacity. In my own view, in their being allowed that limit I felt we were dealing generously with them. That is the position, however, and I would be very much surprised if, by any misfortune, Deputy McGilligan came back into office, he would decide to change that policy.
