I understand that it has been agreed that on this Road Transport Bill the question of transport in general and the proposals contained both in the Road Transport Bill and the Railways Bill will be discussed.
Road Transport Bill, 1933—Second Stage.
On account of the implication of that, I should like to say that the agreement was, as far as we were concerned, that we wanted full scope to discuss the Railways Bill itself when the Railways Bill is before the House, so that if it is implied that full discussion on the Transport Bill will restrict, as far as this Party is concerned, discussion on the Railways Bill, then I would ask the Ceann Comhairle to understand that that is not agreed to. It was agreed that in so far as the Minister might wish on one particular Bill to cover the whole of the transport question, there was no desire on our part to restrict him from covering the whole ground on the one question, but we asked that if that was desired by the Minister that it would not in any way restrict us from dealing with the whole of the Railways Bill on the Railways Bill.
I am quite agreeable as far as that is concerned.
There is one other point. I have an amendment down to one of these Bills, which is the one on the Order Paper later than the one which has now been called. As far as I am concerned I intend to speak first on the Road Transport Bill and not to move the amendment until we come to discuss the Railways Bill. I should like also to make this point by way of forewarning: that I intend to ask for a ruling at a later stage that the Railways Bill is in fact a hybrid Bill and that the Second Stage could not be taken to-day.
Perhaps it would be possible to consider all aspects of the transport problem on the Road Transport Bill and to confine the discussion on the Railways Bill to the financial aspect, and particularly to the writing down of capital, as suggested in the amendment in the name of Deputy McGilligan.
That will do.
I propose to refer to the proposals in the Bill at this stage. I am not interested in Deputy McGilligan's amendment, but the proposals in the Bill have to be explained and justified.
Quite. The Minister desires to cover the whole field. It is a matter for the House, but it would, I suggest, make for the better conduct of business if all aspects of the transport problem were considered now, and the financial business on the second Bill.
The proposal in respect of the capital of the Great Southern Railways is an essential part of the Bill and it cannot be considered separately from the rest.
All right, but subsequent discussion might follow the line suggested.
I hope I do not understand that you are now making a ruling that if there is a wide discussion on the Transport Bill the discussion on the Railways Bill will be restricted to the financial proposals?
Not absolutely, but the main debate will be on the financial side.
"That the Road Transport Bill, 1933, be now read a Second Time."
I assume Deputies have read the two Bills and are familiar with the proposals contained in them and that it is not necessary for me at the beginning to explain them in detail, although I will attempt to do that later. At the beginning I should prefer to describe the conditions which are existing in the transport industry at the moment and to explain the principles upon which the policy enshrined in these Bills is based. The Bills now before the Dáil must be considered in relation to other measures bearing on the transport position which have, from time to time, passed through the House. Since the establishment of the Free State, eight Bills bearing upon railways and road transport have been introduced and have, each of them, to some extent, affected the position that now exists. Whatever our opinions may be as to these measures, their adequacy or wisdom, they have affected, as much by what they have not done, as by what they attempted to do, the development of the transport situation with which we have now to deal. When this Government came into office we found here a situation existing which required, in our opinion, fresh legislative action. That situation has not altered considerably in essence during the twelve months that we have been in office, and the proposals which we now make might have been made at any time during the past year. I think it is desirable that I should give a general picture of the situation as we see it, so that Deputies can keep it in mind when they are considering the suitability of the proposals now made for remedying that position.
In the year 1924, there was introduced a Railways Amalgamation Act, by which all the railways wholly in the Saorstát were amalgamated into one system. That Act was drafted before the development of road transport in the Saorstát as we now know it to exist and without appreciation of the lessons which were to be learned from road transport developments then taking place elsewhere. In addition to amalgamating the various independent railway companies into one organisation, it established a Railway Tribunal, which Tribunal was required to fix a standard net revenue; that is, the revenue which the amalgamated company might hope to earn with economy and efficiency in its management and by charging for the conveyance of merchandise the charges fixed by the Tribunal having regard to its estimate of the volume of traffic likely to be offered. In fact, the railway company, emerging from the amalgamation in no year since the amalgamation succeeded in earning the standard revenue. In each year since the amalgamation, with one exception, its gross receipts diminished, but for a number of years it was able, by cutting its expenditure at a greater rate than receipts diminished, to increase its net revenue, until, in the year 1929. net revenue reached 80 per cent. of standard revenue. That process, however, of cutting expenditure to meet diminishing receipts could not go on indefinitely and, to some extent, might be considered in itself a cause of the diminution in receipts, so that a point was bound to be reached when the attempt to secure standard revenue by that method was going to fail. The only method by which the standard revenue could be attained would be by increasing in some manner the gross receipts of the company and, as I have explained, these gross receipts were, in fact, steadily diminishing instead of increasing, so that after 1929, with the reduction in trade which started in that year, there was a very considerable falling off. In the year 1930, the net revenue was only 71 per cent. of the standard revenue. It was 63 per cent. in 1931, and fell to 45 per cent. in 1932. That was the position of the Great Southern Railways Company, the company which emerged as a result of the Amalgamation Act of 1924. There are five other companies in the Saorstát operating cross-Border services; that is, companies whose systems are situated partly in the Saorstát and partly out of it. One of these companies, up to last year, was subsidised from State funds, and all of them were, either to a similar extent or to a greater extent than the Great Southern Railways Company, affected by the general depression in trade and by the growth of road transport. Unlike the Great Southern Company, however, these cross-Border companies in last year had to face up to the fact that, in consequence of the Government's policy for the development of the natural resources of the Saorstát and its industrial potentialities, they would be deprived, and deprived permanently, of a definite proportion of the traffic which had come to them previously. Of course, all railway companies in this country and in all other countries have had to face up to the fact that a very substantial proportion of the traffic which would have come to their systems some years ago, has been definitely and permanently taken from them as the result of the increase in the use of the private motor car and the private motor lorry. In fact, it is the considerable development in the use of the private motor car for the conveyance of persons and of the motor lorry for the conveyance of the goods of the traders that has produced the most notable effect upon the volume of traffic passing over the railway systems. In the case of the Great Southern Railways Company, however, which is situated wholly in the Saorstát, they had not also to take into account the factor that affected the cross-Border systems. These cross-Border systems have had also taken away from them, as a result of the development of production in the Saorstát, a quite definite proportion of traffic which until recently they could always count upon. The Great Southern Railways system is not affected by that. In fact, the operation of Government policy in the encouragement of production at home is likely to benefit rather than injure the Great Southern Railways system in so far as centres of production of any class of goods are likely to be less numerous than points of importation, and consequently there will be a greater amount of internal transportation.
That is the position which we find in relation to railway companies. In the year 1932 there came into operation a Road Transport Act which was passed through this Dáil on the initiative of our predecessors but which fell to be administered by this Government. That Act related to passenger traffic only, and the scheme behind it was to produce in the Saorstát three transport organisations—one serving the area associated with the Great Southern Railways Company, one serving the area associated with the Great Northern Railway Company, and one in the area of Dublin City. By confining the business of conveying passengers by road to licensed operators, it brought about a position in which the three main transport organisations of the Saorstát might, if they so desired, acquire by purchase an effective monopoly of the passenger carrying business in their areas.
The Great Southern Railway Company adopted a policy of purchase and has to-day throughout the whole of its area what is tantamount to a monopoly of the passenger-carrying business. The policy of purchase was carried out through its subsidiary, the Irish Omnibus Company. The Great Northern Railway Company was unable to attain that position because it could not effect an agreement to purchase with its principal competitors. The Dublin United Tramways Company did not attempt to avail of the opportunity afforded by the Act and the position in Dublin has not been affected to any substantial extent by the passing of that Act except that a number of unfortunate bus operators who could not qualify for a licence under the Act because they did not operate their services for the whole of the qualifying period have been put out of business. Also—this is undoubtedly an advantage —pirating, as practised by certain operators, has been stopped.
I have explained the position as we found it to exist, in relation to the railways and in relation to the transportation of passengers by road. The transportation of merchandise by road was completely uncontrolled. Any person who chose to buy a lorry and who paid certain licensing fees was entitled to engage in the business of transporting merchandise for hire by road. The railway companies had been given by the Act of 1932 powers to engage in the transportation of merchandise by road themselves without restriction and they had availed of these powers. They had organised, either directly or through subsidiaries, road transport systems. They had brought into existence a railhead delivery service and were in a position to quote for the transport of goods from door to door. There were also a number of other persons engaged in the transport of merchandise by road on a commercial scale. In addition a practice had grown up by which private traders running and operating lorries for the conveyance of their own goods occasionally took, when it was convenient to them, merchandise for transportation for hire and very frequently charged very low rates for doing so. That I say was the position we found and it was in relation to that position that we considered the type of legislative proposals that should be brought before the Dáil.
The need for that legislative interference and the extent to which such interference should go were matters to which the Government gave careful consideration from the beginning, certainly for a very considerable period before the Bills now before the Dáil were decided upon. It is the deliberate view of the Government that now and for a long time to come the railways must play a very large part in the transport organisation of this State. It is clear however that if the railways are to be maintained and enabled to play their part efficiently under modern conditions, they must be made part of a wider but a centrally controlled transport organisation. I think that it will not be contested by anybody that railways alone under modern conditions cannot serve our needs. It is clear, I think, that the railways are no longer essential. We could do without them. When however I say they must be maintained, I am expressing my belief that they are or can be made, subject to certain conditions, the most economical means of conveying merchandise and passengers in the greater part of the country, but I think that if the railways did not exist there are very few people in the House, and certainly very few people in the country who would risk their savings behind a proposition to establish them.
The stoppage which has taken place on the Great Northern Company's system will serve to illustrate my point. The strike there has been the longest in the history of this country. It has been, as far as I have been able to discover, the longest railway strike in the history of the world. Yet the public inconvenience caused by it, although it is by no means inconsiderable, is as nothing compared to what it would have been if a similar stoppage had taken place ten years ago. Ten years ago a railway stoppage of that duration would have brought about a national emergency of the first order. To-day it is merely an inconvenience and I trust Deputies as well as railway directors and railway workers will appreciate the significance of the change.
The Government has taken the view that competition in transport is neither necessary for efficiency nor desirable for its own sake. The facts of the situation seem to indicate that unless the existing competition in its most intense form can be ended the continued operation of the railways will be seriously jeopardised. It should be made clear however that the Bills now before the Dáil are not designed merely to save the railways but to give the country a suitable transport system which will adequately serve the public needs while at the same time capable of being operated on a profitable basis.
First of all the Government considered the question of nationalising transport—I do not mean merely nationalising the railways, as some people have suggested, and which in my opinion would be worse than useless, but nationalising public transport.
Nationalisation, in my opinion, has a lot to commend it. We were struck by the fact that every public commission or committee established before or after the creation of the Free State to inquire into the railway situation here recommended nationalisation. We had ourselves recommended it. It could be effected without any considerable difficulty, without much more difficulty than is involved in the operation of the Bills now before the Dáil. Yet the Government decided against it. There were a number of considerations which influenced that decision. There was in the first place the fact that railway nationalisation in other countries does not appear to have been wholly successful although I cannot say that my information upon that point is complete or that the argument is, in any case, conclusive. There is the fact which I think is beyond doubt that in the circumstances now existing nationalisation of transport in the Saorstát would involve for some time at any rate a substantial subvention from public funds for a number of reasons. Certainly there is nobody proposing to nationalise our transport system who would not prefer to do so in a period when depression had passed and trade was improving.
There is also the circumstance peculiar to this country, that it would be difficult if not impossible to bring all the railways of the State into a nationally-owned organisation. To attempt it would probably involve a substantial diminution in employment and it would be anomalous to have existing side by side a nationally-owned and a privately-owned transport organisation. I had an opportunity while in Canada last year, where that position exists, of appreciating the difficulties created and the anomalies resulting from the existence of two such organisations within the one State.
Would the Minister pardon me for interrupting him? I think it would be exceedingly instructive to give some examples of the anomalies to which he referred.
I do not propose to do so now. We can debate that matter at another time. In addition to this consideration, however, there was another consideration and that was that the Government does not command a majority in the Seanad, and there was the possibility that proposals for legislation involving the nationalisation of transport would not pass through that House, and might be suspended, under the constitutional rule, for eighteen months. I ask Deputies, who are inclined to treat that argument as having no weight, to contemplate the situation that would exist if proposals for nationalisation were to come into operation at the end of a fixed period, and the railways, in the meantime, were in the hands of private owners, and I ask them to consider what would happen, in these circumstances, having in mind particularly their regard for the interests of the transport workers. It was that last consideration that finally determined the Government to proceed to deal with the transport situation in the manner it is dealt with in this Bill, without weighing further the pros and cons of nationalisation as if that particular difficulty did not exist.
The Bill before the Dáil follows the idea behind the Road Transport Act of 1932, in the matter of the division of the country into three main areas. In view of that, however, I wish to say, as my predecessor stated in introducing the 1932 Act, that its success, in achieving the objects aimed at, will depend on the extent that railway directors and tramway directors can cease to regard themselves as such. If I have misquoted the Deputy opposite I shall withdraw.
The Minister means as I meant "as such exclusively."
There is one point at all events on which I agree with the Deputy and I am sure he feels flattered. If the provisions of this measure are operated by men railway-minded and tramway-minded only, not merely will they fail in their purpose but nationalisation, no matter how difficult, will be made inevitable. The aim is to establish a suitable transport service which will provide the public with all the forms of transport they need and that best serve their purpose.
These Bills are not measures to stamp out omnibus services or road merchandise services, or to enable the railways, or the tramways, to get back to the position of ten years ago. Omnibuses and lorries will serve the public in a way in which railways and tramways cannot hope to do. These Bills are not measures to make railways more profitable to owners but to get new transport conditions in which the railways will be important parts of an organisation which, as a whole, will be capable of operation upon a profitable basis. It would perhaps be better if I explained the purposes behind the Bill by taking the major provisions in order, and indicating the considerations lying behind the decision to adopt them. The Road Transport Bill has two main ideas embodied in it. One is that of applying to the business of conveying merchandise by road, the same licensing conditions that at present operate in respect of the business of conveying passengers by road. The second is to introduce a new consideration in relation to both systems of licensing, that is to provide that in certain circumstances, and subject to the discretion of the Minister for Industry and Commerce, road services can be compulsorily acquired by railway or tramway companies.
The task of devising a suitable method of applying a licensing system to the business of conveying merchandise by road was not an easy one. I think, however, we have devised a system which will achieve the end aimed at and will, at the same time, be comparatively simple to operate. It is proposed that every person who claims to have been operating a merchandise road service on a particular date—any date chosen by him between July last year and the 8th February this year—the date on which the Bill was introduced—will be able to claim, and will be entitled to receive, a licence. The method of granting licences under the Road Transport Act of 1932 was grossly unfair in my opinion. I had the very unpleasant task of operating that Act and had to refuse licences to persons who invested their life's savings in the purchase of one, two or three omnibuses, but could not qualify for licence because they started their services at a date subsequent to the qualifying date in the Act.
You could have given them licences.
No, if I attempted to administer the Act as it should be administered, with the intention of securing that nobody should get a licence in respect to a road on which another service existed.
Does not the Minister admit that it was entirely at his discretion?
I admit nothing of the kind. The Act requires that a licence shall not be issued to parties proposing to run a service over roads upon which the public requirements are adequately met by another service.
That is all subject to the Preamble which provides that absolute discretion is given to the Minister.
The Deputy should read the Act again.
Shall I read it to the Minister?
No. The Deputy has already staked his right to make three speeches. Any person who had a service operating between the 8th February, 1933, to any date back to July, 1932, will be entitled to a licence. He will be allowed himself to state the area in which he proposes to carry goods for hire, and the class of goods he is prepared to carry. Whatever restrictions he imposes upon himself in his application will attach to his licence. Having decided the area in which he proposes to operate, the class of goods he proposes to carry, he will be required to carry in that area goods of that class offered to him by anybody, and to give the same terms and the same conditions to all persons. He will be a common carrier. The existing operator, however, will be confined in this way: that his licence will not enable him to operate a service on a greater scale than that already operated by him; and we propose to measure his service by reference to the unladen weight of the vehicles used by him in connection with it.
There is this big gap in that licensing system, however, that a licence may not be refused to a railway company, a tram company, a canal or shipping company. It is proposed to enable these companies to operate road services as they consider necessary. It will be possible for a railway company or a tram company to apply to the Minister for an order transferring to it the licence held by any independent operator and the Minister will make that order if he thinks that it is in the public interest, in which case the independent operator ceases to be the licensee, ceases to be entitled to run the service, but will become entitled in default of agreement to compensation to be fixed by an arbitrator.
In some sections of the Press criticisms of that provision have appeared. Apparently some leader writers connected with some of our daily papers have ceased for the moment to denounce Communism, confiscation and the like for the purpose of advocating it for the benefit of the railway companies. The contention apparently is that the business of independent road transport operators should be handed over to the railway companies and others without compensation. If that is not quite what they mean, they have not succeeded in making their meaning clear. Either the railway companies should acquire these services for payment or they should get them for nothing. Our proposal is that they should be required to pay for them and, under this Act, they are not merely given an assurance that if they acquire some independent road service, a new road service will not be able to be created to take its place, but also that they will be able to effect that acquisition compulsorily in the event of an agreement not being made.
That power of compulsory acquisition applies not merely to the road services now licensed for the first time under this Act, but also to the passenger services licensed under the Act of 1832. It will apply not merely throughout the areas served by the railway companies, but also in the City of Dublin in respect of the Dublin United Tramways Company. It is proposed that the road services operated by these privileged companies shall be subject in respect of charges to the supervision of the Railway Tribunal. The Railway Tribunal shall prepare a classification in respect of the classes of goods to be carried on these road services and shall sanction the schedule of maximum charges. These measures are being adopted in the public interest, for the protection of the public, because we contemplate that under the operation of the Act the railway companies will acquire—and certainly are being empowered to acquire in their areas—a complete transport monopoly. They will be, in fact, the only public carrying agencies, and consequently it is necessary, in default of another system, to ensure protection for public interests by maintaining the supervision of the Railway Tribunal and the system of standard charges.
Certain proposals have been made to the effect that the railway companies should be released completely from all restrictions in respect of charges. And again that proposal comes from people who would resent very much any suggestion that their morality was not everything that might be desired. The idea apparently is that the railways should be allowed to charge anything they like without restriction, without regard to any obligation to ensure equal terms for all the citizens and all the traders; that they should be free to close down one port for the benefit of another, to destroy the industrial prospects of one town for the benefit of another and to give preferential treatment to one trader as against another. I do not contemplate that anyone in the Dáil is prepared to advocate such action on our part. We do not propose to do it. That is why it is intended to retain such of the restrictions as are imposed on the railway companies, either as companies operating road or railway services to ensure that they will not be at liberty to abuse their monopolist powers when they get them, and that there will be a court to which traders, merchants, manufacturers and the representatives of particular districts or towns can appeal when they think their interests are being prejudiced.
We propose also that when and where the road services operated by an independent operator are acquired by the railway, shipping or tramway company, compensation shall be payable to ex-employees of the acquired services. The conditions under which that compensation will be calculated and payable are set out in Section 57.
Will an existing carrier be controlled as to the rates he charges?
He is free to charge what he likes?
What is the name of the railway company that is running a road service under the direct control of railway management?
I think there are several.
What are their names?
The Great Northern is one.
The Great Northern is not dealt with in this Bill.
Certainly it is dealt with. The Road Transport Bill has as much significance for the Great Northern as for the Great Southern Railway. It applies as much to the areas covered by the Great Northern Railway as to the areas covered by the Great Southern.
Is the Great Southern Company running a road service under the direct control of railway management?
I will deal with that. One of the provisions requires a certain explanation. We propose to exempt from the Bill an area within a circle having a radius of fifteen miles, and having its centre at the post office which, on the appointed day, is the principal post office in any of the following cities or towns:—Dublin, Cork, Limerick, Waterford, Sligo, Ballina, Drogheda, Dundalk, Tralee, Westport, Galway and Wexford. When we were considering this matter, originally, we had in mind the possibility of a company being formed for the purpose of undertaking suburban distribution in the vicinity of Dublin or other large towns. We do not propose to allow such company to be acquired either by the railway company or tramways company or to bring it subject to the restrictions as regards licensing which this Act requires. When we considered the matter we found it difficult to determine exactly to what towns that provision should apply. If it would apply to Dublin it was thought that it should also apply to Cork, Limerick and Waterford. Finally we prepared a list of the towns from which there are direct and regular steamer services. It is reasonable to assume that these towns are centres of distribution. It seems to me, however, some modification of that provision will have to be adopted, particularly with regard to towns which are in close proximity one to the other. The provision exempting a radius of fifteen miles might mean overlapping, and might, in fact, bring two towns into the one area.
That is a matter which can be discussed in detail on the Committee Stage. Now as regards the Railways Bill. In the first place, I want to refer to the point made by Deputy Davin. It would seem at first sight that there is a substantial omission in this Bill inasmuch as it does not require the road services owned by the Great Southern Railways Company to be brought under the same management and control as the railway services owned by that company. It is definitely our intention that that should take place, as it seems to us eminently desirable that it should take place. The intention is to create a transport organisation, not a road organisation merely or a railway organisation merely, but both, in a position to supply in any part of the country the type of transport service that suits its needs and the public convenience. In our opinion the road passenger services and the road merchandise services owned by the railway company should be under the same management and under the same direction as the railway service owned by that company. We would have embodied a provision in this Bill requiring such concentration of different services but we have been assured that it is not necessary, as preliminary steps towards such unification of the three services have been taken and can be brought about by a stroke of the pen and that that stroke of the pen will be made when we indicate that we want it made. We are giving an indication now that we want it made.
If these carrying companies decline to take the steps that the Minister says he has been assured they will take, what happens then?
I do not think that will happen, but if it did I would have no hesitation in taking steps to introduce proposals for legislation to deal with it.
Why not make sure of the matter when the Bill is going through the House and have that provision inserted?
I do not think it is necessary.
What is the objection?
There is no objection.
Would you accept an amendment on the Committee Stage to have that provision made?
I have been assured that unification can be achieved by a stroke of the pen, and that a stroke of the pen will be made when we ask for the making of it. In connection with the Railways Bill most comment has been made upon the provision concerning the reorganisation of the Great Southern Railways capital. I do not know why that should be so. It is of course from one point of view the most spectacular part of the Bill but I do not think, and I am surprised that anyone would think, that it is the most important part of the Bill. I at no time regarded it as such. In order to explain why that particular section appears in this Bill I think it desirable that I should refer to the speech made on Friday last by the chairman of the Great Southern Railways at the annual meeting of the company. At that meeting the chairman of the Great Southern Railways said:
"In all our conferences with the Minister, he was insistent in his demand for a reconstruction of the capital simultaneously with the enactment of any measure of relief for the railway. He contended that it was obviously hopeless to ever again earn any dividend for the greater part of our shareholders, so long as their existing nominal capital values remained unaltered. That was of course an undeniable contention."
Later on he said:
"To gain information for ourselves we employed an eminent firm of financial accountants and experts to examine our accounts and financial condition and to advise us as to the feasibility of evolving from them an equitable scheme of reconstruction. Their report laid it down that no scheme, based on anything but guesswork as to the future, was possible to be set up. Subject to this specific proviso they submitted a scheme for our guidance and criticism. That scheme was shown to the Minister as it stood, without endorsement or approval, indeed without any examination or consideration by the board. This fact was made clear to the Minister, who was merely invited to say whether the scheme outlined was of the nature he has so strongly intimated would be an essential element in his railway relief legislation."
I do not want to quarrel with that account of what happened in the various conferences that took place between the board of the Great Southern Railways and myself. It is correct that I was insistent from the very beginning that any proposals for the amendment of the laws relating to the railways should be accompanied by a reconstruction of the company's capital. That was indicated by the Chairman of the company in his speech. The directors agreed with me in that. They agreed that reconstruction of the company's capital was desirable. They, as the Chairman stated, engaged the services of a very eminent firm of financial experts and accountants to prepare a reconstruction scheme. The scheme prepared by these experts was submitted to me by the board of directors. I did not comment upon the scheme. The board wrote on a couple of occasions, subsequent to the meeting at which I saw it for the first time, to know if the scheme had my approval. It is clear that no such scheme could be brought into operation without legislation of some kind and that it would, in any case, take considerable time to bring it to a head.
It is, of course, quite true, as stated by the chairman of the company, that any such scheme must to a large extent be based upon guesswork, because no one could possibly pretend to foresee what the railway earnings are likely to be for ten years ahead. We do not know how anyone can pretend that information can be secured by an individual or company or a committee of anonymous experts which would give the information as to the future earning of the railway which would permit of a scheme being prepared which would be based on anything else but guesswork to a great extent. The question we have got to ask ourselves on this scheme and its origin is whether it is necessary in the first place, and whether it is equitable in the second place. I am not putting the responsibility for the scheme on the railway directors. We take the responsibility ourselves. We do not propose to pass that responsibility on to the backs of anyone else whether a committee of inquiry or the board of the railway company. As to the question whether a scheme of reconstruction is necessary, I think it must be admitted that taking any reasonable view of the situation at all there is an imperative necessity as far as the company is concerned for a reduction in charges or an increase in revenue or both. I do not suppose anybody is going to contest that statement. There is no possibility as far as it is possible at the present time to foresee of such an increase in revenue taking place as would leave a reduction in charges unnecessary. If a reduction in charges has got to take place, is the reduction to be solely at the expense of the efficiency of the railway management or solely at the expense of the railway workers? Is not part of the reduction to be at the expense of the railway proprietors and debenture holders? Apart, however, from that consideration, there is another consideration of equal importance. The nominal value of railway stocks and the nominal value of any class of stock is in itself of no real importance. The value of railway stocks to their owners depends upon their dividend earning capacity.
There is nothing in this scheme for the re-organisation of capital, which is going to increase or decrease, in any way, the possibility of the company earning revenue. The dividends payable upon the stocks will be dependent upon the earnings, and the value of the stocks on the Exchanges will be dependent on the dividends. The Great Southern Railway debentures carry interest at 4 per cent. A 4 per cent. return on a gilt-edged security is a good return under present conditions. Ordinarily, one would expect to find a gilt-edged security earning 4% quoted in or about par. The Great Southern Railway debentures are quoted in or about £35. Yet there has been no default in the payment of interest at any time. You could buy for £35, £100 debenture stock upon which 4 per cent. interest is payable. Why is that stock quoted at that low figure? If £35 represents the estimate of the value of that stock in the minds of the average investor and in the minds of the commercial community, it is quite obvious that there are serious doubts existing as to the prospects of the company being able to continue to pay the interest upon that stock and that, consequently, its sale value must be written down. The action which we are taking here is in the interest of the stockholders in so far as it is going to increase their prospects of getting a return upon their investments and to increase the value of the assets which these investments represent.
To enable us to follow the Minister, will he say if he proposes to deal firstly with the debenture stock and then to deal with the preference and ordinary stock separately, or do his observations apply to all stock? Is he including debentures with the ordinary stock?
I propose to make the speech I think advisable and to follow instructions from nobody.
I am merely endeavouring to follow the Minister carefully.
The fall in the net railway receipts in recent years is a matter of common knowledge. There has been a fall of over 50 per cent. in these receipts between 1929 and 1932. The earning capacity, as I have said, is not now and, so far as we can reasonably foresee, never will be such as to provide a reasonable return upon a capital of £25,700,000. If a receiver were appointed to-morrow, does any person believe it would be possible for that receiver to realise upon the assets of the company more than the written down value of the stock, £11,784,000? On that account, we can contend that the provision for the writing down of the capital of the company is merely an anticipation of the inevitable.
Will the Minister explain the difference between a debenture and either a preference or ordinary share?
I am dealing now with the necessity for carrying out capital reconstruction. The equity of the proposals embodied in the Bill can be considered separately. I submit that they are two separate questions. If there are people who think that they can produce more equitable proposals, I trust they will not hide their lights behind a bushel between now and this day fortnight.
The Minister is studiously avoiding the debenture question.
I shall endeavour again to explain the position to the Deputy in the hope that my explanation will penetrate. There are two questions at issue—the necessity for this capital reconstruction and the equity of the scheme proposed here. I am now dealing with the question of the necessity for capital reconstruction.
And the competence of this House to confiscate property.
We shall deal with the equity of the scheme in a moment. If the Deputy cannot possess himself in patience, I suggest that he go for a walk round the lobby for three minutes.
Does the Minister realise that debenture stock is not capital?
I have said that the writing down of the capital is merely an anticipation of the inevitable. It is quite true that it appears to impose sacrifices but, in the long run, far from imposing sacrifices on anybody, it will probably benefit stockholders as a body. On the other hand, if it does impose sacrifices is it not much more desirable that these sacrifices should be imposed in an equitable, reasonable, carefully-calculated manner rather than that they should come haphazard at some time in the future? It is quite clear, I think, to the minds of most people that the equipment purchased by capital investment in the Great Southern Railways Company is, in great part, no longer capable of earning revenue. The allegation is frequently made—so far as the facts at our disposal can be analysed, it seems to be justified—that the railways have been starved, that adequate provision has not been made either for maintenance of the permanent way or for the renewal or renovation of the rolling stock. I have been informed that to bring the branch lines of the Company into a condition in which they would be regarded as in a reasonable state of repair would require an expenditure over five years of £800,000. Deputies are, I think, aware that upon very large stretches of the Great Southern Railways Company's system there are very restrictive speed regulations in operation because the lines are not safe to carry trains travelling in excess of fifteen or twenty miles per hour. I do not think that anybody acquainted with the railways, anybody who takes the opportunity of travelling upon them when they have to move around the country, will disagree with me when I say that there is plenty of work to be done in bringing them into a proper condition, making the trains clean and comfortable for passengers, as well as bringing up to date the carriages provided for the conveyance of live stock and other classes of merchandise. What has happened is that because of the inflated capital of the company and the natural desire of the directors to make a return upon that capital, money has been taken out of earnings which should have gone into maintenance. Money which should have gone towards keeping the assets up-to-date and providing this country with a suitable railway service has gone to the payment of dividends upon the shares which the earnings did not justify. If there was proper expenditure on the maintenance of the permanent way and rolling stock and proper provision for maintaining the assets of the Company, there are very few classes of railway shareholders who could expect a dividend for many years to come. Unless there is a reorganisation of capital, unless there is an alteration in the conditions prevailing, I think it is quite clear that most classes of railway stock are going to become quite valueless in a very short period. In any case, it does not appear at all inequitable to me to ask the railway proprietors to make some contribution towards placing the Company in a sound position.
There are wider considerations to be borne in mind. We are introducing legislation designed to give the railway companies an opportunity of acquiring a monopoly of all forms of transport. They will be the owners not only of one system—the rail system—but also of road omnibus services and of road merchandise services. If those services are going to be acquired and the railway company is going to operate them with the one intention of getting out of them as much as they can to pay a return on the £26,000,000 capital, the purpose behind these Bills is going to be defeated. If we are going to have a sound transport organisation in this country some provision of this kind is essential, and I say the only alternative is nationalisation. If the railway companies are successful—or any Party in this Dáil thinking they are acting on behalf of the railway company—in securing the defeat of this proposal or a substantial delay in its operation then there is going to be one alternative only, if efficient transport organisation is to be provided for this country, and that is nationalisation. I should like to say also that all intelligent people who have examined the transport position here are agreed that reconstruction of the capital of the Great Southern Railways Company is necessary.
How is that going to increase the revenue?
As I have already pointed out to the Deputy, it is not going to increase the revenue.
Is the Minister going to differentiate and explain to the House the difference between Debenture Stock, Preference Stock and Ordinary Stock?
I will come now to the question of the equity of the scheme proposed.
I advised the Deputy to go for a walk. I am sorry if I bore him.
Thank you, but the Deputy will remain here.
The equity of the proposals contained in the Bill depends upon the relative values of the rights of the holders of the various denominations of stock. They depend upon the future earning capacity of the company. It is quite clear that the rights attaching to stock—the rights of shareholders—in a large measure depend upon its earning capacity. They may have rights that are valueless. If the company is not earning a revenue capable of paying a return it is very little value to have a right to that return. I recognise, and in fact it cannot be otherwise contended, that the Debenture holders are in a special position.
I have, however, already pointed out that the commercial community's estimate of the value of £100 Great Southern Railways Debenture Stock is £35, although there has never been at any time a default from the payment of the interest on that stock. Debenture Stock is a debt due by the company and secured upon its assets, and does not represent a share in the ownership of the company. I think Debenture holders, whoever they may be, as well as the proprietors of the company, can be expected to face facts. If they put in a Receiver to-morrow it is, I submit, an open question whether it would be possible for them to realise the face value of the Debentures, particularly in view of the fact that adequate expenditure upon the maintenance and the repair of the system had not been undertaken. If adequate expenditure for this purpose is undertaken it seems clear that unless there is a very substantial alteration in the position there will be no Debenture interest to pay. I do not think it is at all inequitable that the Debenture holders should be asked to take their share in the general sacrifice. We are asking them to accept a reduction of 15 per cent. in the value of their holdings. That involves a reduction in the return on their investments to £3 8s. Od. per cent. I do not think in that connection it should be overlooked that the State is itself contributing to the reorganisation by remitting entirely the charges enumerated in Section 2 of this Bill.
I give these considerations to the Dáil in relation to this scheme for the reconstruction of capital:—First, it is necessary. Everybody is, I think, agreed that capital reconstruction is necessary. Secondly, in relation to the proposal which is actually contained in the Bill, I tell them it was prepared for the Great Southern Railways Company by a very eminent firm of accountants. I am not trying to divest myself in any sense of responsibility for its introduction here. I am merely giving information as to its origin. It seems to us to be equitable on the face of it, having regard to the rights attached to the different classes of stock, and any reasonable estimate as to the future earning powers of the company. If there are Deputies who think that they can produce a more equitable scheme or a more equitable series of proposals they can come forward with their suggestions. We accepted it as a fair proposal having regard to the circumstances, and it is in that light we bring it forward here and recommend it to the Dáil. It has been said that this reorganisation should not take place without consulting the shareholders of the company. I would have preferred that this scheme of reorganisation should have come into existence as a result of the voluntary action of the shareholders of the company, but it appeared to us that we could not afford to wait indefinitely for such action to be taken. The position was that in any case a scheme could not have been brought into effect unless certain legislative provisions had been introduced here and certain legislative powers had been conferred upon the company. In any event, we would have precisely the same criticism, voiced in the same quarters, concerning the provisions that would be necessary to give those powers as we are having now in relation to the provisions contained in the Bill.
Might I ask the Minister if the company's Bill contained any provision for the reduction of capital?
It did not contain any such provision?
I am speaking now in relation to a Bill submitted by us to the company, and which contained, as far as I can recollect at the moment, provisions relating only to the control of road transport.
There is nothing in it about writing down capital?
I do not think so.
Could the Minister give the terms of reference of the firm of accountants who submitted this scheme?
I had nothing whatever to do with that.
It depends very largely on who directed. The railway directors, I presume, represent the ordinary stockholders.
I will quote the words of the chairman of the company.
I presume the Minister, if he stands over it, will be entitled to give to the House an account of the proceedings previous to the submission of this scheme. It is obvious to anybody that if a group of debenture holders asked for a scheme they would get a different reply from a group of guaranteed preference shareholders, that a group of preference shareholders would get a different scheme from a group of ordinary shareholders, and that a group of ordinary shareholders would get a different scheme from any one of of the other two. What I want to see is the terms of reference submitted to this firm of accountants by whom this scheme was prepared.
I will give the Deputy the only information I have on the matter.
He laid down the history of the scheme, but avoided the equities.
I do not think so.
The Minister did not explain the nature of debenture shareholders or stockholders or guaranteed preference holders or ordinary stockholders or how their rights were respected in connection with this particular distribution——
I think it is quite clear that the proposal contained in the Bill has taken into full account the rights of each class of stockholder.
The Minister has not dealt with it.
I do not know in what fuller way I could deal with it.
I would like to ask the Minister was the scheme prepared by them prepared as a scheme to be enforced through legislation or was it prepared as a scheme to be submitted to the company themselves.
The origin of the scheme was this, as the chairman of the railway company stated:
"In all our conferences with the Minister, he was insistent in his demand for reconstruction of the company's capital simultaneously with the enactment of any measures of relief for the railway. He contended that it was obviously hopeless to ever again earn any dividend for the greater number of our shareholders, so long as their existing nominal capital values remained unaltered. That was, of course, an undeniable contention."
Now the Chairman says as follows:
"To gain information, however, for ourselves we employed an eminent firm of financial accountants and experts to examine our accounts and financial condition, and advise us as to the feasibility of evolving from them an equitable scheme of reconstruction."
A scheme might be equitable if it was a scheme whereby people of their own free will were going to be asked to accept. I am thinking of the special conditions of creditors and debenture holders——
I assume that this scheme was prepared on the basis of voluntary acceptance.
You had better go back on the chairman's statement—I mean the part you skipped. There is a statement about debenture holders specifically made.
Very well: "We pointed out to him that any effective scheme of reconstruction must embrace the debenture holders, who were in regular receipt of their full interest, and whom we did not represent."
There is another sentence.
"It would be idle for us to invite or try to persuade them to make the sacrifice of their income unless and until we could assure them of some resulting added stability of the railway undertaking. It was impossible, therefore, to approach them at that stage." And what I said to the railway company was this: that I regarded as an essential feature in any proposal for the reconstruction of our transport system a reconstruction of the Great Southern Railways Company's capital, and that the conferring upon the company of the privileges and concessions these Bills will confer would not be justified unless that re-organisation of capital were undertaken at the same time.
I am only asking you one word. The Minister said he assumed this scheme brought forward by a firm of accountants was brought forward as a voluntary matter. Does he still hold to that word "voluntary" after what he has read?
I am not responsible for the terms of reference given by the railway directors to their accountants.
I am not asking you that.
I am assuming, and I admit I have no grounds for my assumption, that the directors when they asked their firm of accountants to prepare a scheme had in mind at the time a scheme which would be submitted to the various classes of stockholders for voluntary acceptance. We will have another opportunity of going into this matter.
We inquired for the terms of reference.
I am taking responsibility for the scheme. I am submitting it here as a scheme——
The House is entitled to know what the basis is. The Minister apparently does not know the meaning of it.
Having regard to the rights of the different classes of stockholders, having regard to the estimated earning capacity of the companies, that scheme was an equitable scheme, and if you think otherwise prove it.
Let us think of a number like the company.
I am submitting it to the company. If we took the market value of the stock we would be writing down the capital to £5,000,000.
I want the Minister to explain fully.
If we had taken the capital of the company and related to the standard revenue fixed in 1925 and considered in that light what the capital should be in relation to the actual earnings, in 1932, we would be writing down the capital by at least £3,000,000 more.
Ignore the capital and deal with the interest. That is more important.
Is it unreasonable to ask the debenture shareholders to make some effort? There is no hesitation about asking a railway porter down in Ballybunion to sacrifice 15 per cent. of his wages in order to preserve the company; there is no hesitation about disemploying men for whom there is no work. Is it unreasonable, or inequitable, or immoral, to ask debenture holders also to make a sacrifice which not merely benefits the company, but also secures that their stock is going to be of more value and their term of interest going to be prolonged? Will the Deputy explain why it was that debenture stock went up as soon as that Bill was published?
And down again. I would invite the Minister to throw a couple of thousand pounds worth of that stock on the market next week and see what it will come to.
I would like the Minister to say if, in his opinion, this Dáil is competent to confiscate property by legislation. It may be equitable if debenture holders agreed to it. Are you competent and do you maintain your right in this Dáil to confiscate the private property of the citizens?
And without hearing the persons concerned. The Minister is obviously all mixed up. As regards the dismissal of a railway porter in Ballybunion, I presume there would be further dismissals. There would be a man with a certain length of service and a man with longer service would have better rights than the other. The Minister has not dealt with the equity of this particular proposal, with the actual inherent equity of it, as I understand it, and as it has been put forward.
One debenture holder has the same rights as another. One debenture holder cannot deprive another of his rights. In what form are we going to secure a reduction of the amount payable in debenture interest, assuming it is desirable to do so?
The Minister is misunderstanding me. There is a reduction here on the debenture interest. It is a small reduction. There is a reduction on guaranteed preference stock of 50 per cent., there is a reduction of ordinary to the extent of 90 per cent. Now, the ordinary might have been reduced 99 per cent. and it would not affect the issue, but keeping the preference stock with 95 per cent. reduction. The Minister has not explained the equity of that and the reduction of 50 per cent. guaranteed preference which is accumulated I believe.
I suggest that we are on the Second Stage, not the Committee Stage.
The fact is, however, that as far as the debenture holders are concerned, if there was to be any reduction in the value of the debenture stock, or of interest payable on that stock, there would have to be legislation here. There would have to be exercised by this Dáil its right to interfere with private property when a national interest is involved. It has a right to do that.
Are we on the Second Reading?
In any case, I said we were going to get an opportunity of going into these matters in detail and of examining any alternative proposals submitted.
I have no interest in this. The only stockholder I know is a debenture holder, and I am not interested in him because he is well able to stand for it. The person more concerned is the ordinary shareholder, but he has very little right in this. What I am interested in is the equity of the whole proposal and the danger there may be by reason of any action taken without hearing the persons concerned, thereby causing an injustice.
We can have all that again. We are proposing to preserve for a period of three years the trustee status attaching to certain railway stock despite the fact that dividends may not be payable on the ordinary stock of the company during that period. That is to prevent any dislocation in that connection during the period until re-organisation has taken place, and while the present depression exists. We are proposing also to provide for reconsideration of standard revenue by the Railway Tribunal in consequence of the reconstruction of capital taking place under the Bill, and in that connection a reconsideration of standard charges, although I do not anticipate that any alteration in standard charges will take place in view of the fact that the Railway Tribunal has already certified that no alteration in the system of charges which it could devise would enable the company, under present conditions, to earn the standard revenue. We propose also to bring into operation a system of electing the directors by postal voting. That is a system which has been recommended to us from many quarters and which, in our opinion, will avoid many of the abuses necessarily inherent in the system of election by proxy voting. We propose also to reduce the number of railway directors to seven and to provide for an election of these directors next year. These are all matters we can discuss in detail at another stage, but I want to draw particular attention to the proposal to abolish the right, given, under an Act passed in 1924, to the London, Midland and Scottish Railway Company to nominate a member of the Board. That right has been abolished. I am not at all sure why that right was ever conferred. I feel satisfied that if I had been in the Dáil at the time the Act was passed I would have opposed it just as strongly as other persons opposed it—members of the Labour Party, Deputy Mulcahy, Deputy Esmonde, and other Deputies still in the House.
And Deputy Davin.
Will the Minister explain Section 2 of the Railway Bill?
Section 2 remits certain debts due by the railway company. It is the State's contribution to the reconstruction of capital. We agreed to remit entirely a prior charge exercisable in our favour which involves a saving of about £15,000 per year.
Is that interest and sinking fund?
Was there any request for remission?
Yes, they wanted more than that.
The directors should have drafted the whole Bill.
They will have to get more than that.
The Act which conferred upon the directors of the London, Midland and Scottish Company the right to nominate a director was based upon an agreement which existed between that company and the Dublin South Eastern Railway Company, under which in consideration of a loan of £100,000 given to that railway company the London, Midland and Scottish, or as it then was, the London, North Western Railway Company had a right to nominate a member on the board of the Dublin South-Eastern Railway Company. Subsequent to the amalgamation a Bill was brought into the Dáil conferring the same right upon the London, Midland and Scottish Company in respect of the amalgamated company, in consideration of the agreement which was referred to, and which was stated to give to the amalgamated company certain preferential treatment in respect of the division of through rates involving a saving of some thousands of pounds per year.
Apart altogether from the fact that the London, Midland and Scottish Company, to my knowledge, had never conferred any benefit upon any body in this country except they got the best part of the bargain, and they are never likely to, I do not think the circumstances which now exist would justify us in continuing this right of representation. It was, perhaps, possible to justify the conferring of that right when it meant appointing one member to a board of sixteen. It is a different consideration when it involves appointing one member to a board of seven. If the transport organisations of this State are to be made to play the part which they could play in its development and organisation, then I think we must ensure that persons will not be in a position of control and responsibility in relation to these organisations whose interests must, in all the circumstances of the case, not be our interests, but the interests of outside transport organisations. I have nothing to say concerning the manner in which that right to nominate a director has been exercised, although in relation to the particular company on whom that right was conferred I think I am justified in saying that, as far as I have been able to discover, they have never at any time shown the slightest desire to do anything which would be regarded as a benefit to this country, even in the employment of very junior employees in any of their services.
A certain section of the Bill deals with the cessation of certain railway services and it repeals a somewhat similar section which appeared in the Railways Act of 1932. I am referring to Section 8. Under this section the Minister for Industry and Commerce will have the right to make an order empowering the railway company to reduce or cease railway services upon any line or any part of a line in the country. That power is exercisable not merely in relation to the Great Southern Railways, but any railway. That order, however, cannot be made unless the Minister is satisfied that the company has got legal authority and the necessary licence and intends to provide in the area formerly served by the railway a road service capable of providing for the requirements of the area. If an order is made it will be lawful for the railway company to cease or to reduce services and will relieve them from the obligation of keeping people in attendance at level crossings to open and shut gates and things of that kind, although it will not relieve them from their obligation to maintain bridges, level crossings, fences, drains and other works which they are by statute required to maintain.
The company will not be enabled to take up the line?
There is nothing in this Bill which relates to that, but personally I see no reason why they should not have that right, because it seems to me quite clear that if services cease upon any particular branch line of the company they are never likely to be restarted.
Would the Minister say how many such applications are in his Department and how many have been examined?
There are no applications in the Department at present. We did, however, receive during the course of last year from the Great Southern Railways Company seven applications for the reduction of services on branch lines. These applications were all granted—five at the discretion of the Minister and two after local inquiry. We have no application for the actual cessation of the services. We have only applications for a reduction in the number of trains running. I might say definitely that, in my view, quite a number of branch lines of the company must close if the railways are to survive on a profitable basis. Most of them have been losing money since they were constructed, and nearly all of them are losing money under present conditions. Where it seems reasonable to assume that road services can be provided which will serve the needs of the country, I want to tell the Dáil that I will not refuse applications for an order to close a number of these branch lines.
Will the Minister say why he seeks that power from the House without giving the public an opportunity of going before a public inquiry? Will he also say, in view of that extraordinary statement of his, what ground he has for baptising this Bill as a Pro-Railway Bill?
The Great Southern Railways in 1922 earned enough to pay debenture interest with some thousands of pounds more, but they paid no interest on any other stock. They paid that debenture interest by curtailing expenditure on the maintenance of the system and on the maintenance of the rolling stock. If adequate provision were made in the company's accounts for depreciation and maintenance, including arrears of depreciation, there would be no debenture interest paid. Under these circumstances, we can contemplate the stoppage of railway services, not merely on branch lines but on the whole system. We have to face up to the fact that unless we can by legislation, or, as a result of changes in the condition of the country, improve the ability of the railways to earn revenue, the railways cannot be maintained, except they are subsidised out of State funds. If it is going to enable the company to continue the main and important services on a better basis, and for a longer time, then I would not hesitate to make an order, and to defend the making of the order, for the closing of unremunerative branch lines, which are no longer carrying either the number of passengers or the quantity of merchandise necessary to pay operating costs. The position at the moment is that on a number of lines, not merely do the receipts not pay all the costs, including a return on the capital invested, but they do not pay the cost of working. They do not pay the cost of the coal used in the engines, and the wages of the workers operating them. It seems to me, for the benefit of the system as a whole, and in the interests of efficient transport organisation, we have to contemplate the termination of these railway services where, under modern conditions, it is possible to provide, as the railway company undertakes to provide, suitable road transport.
Surely it would be in the interests of the Department and of members of the Dáil that before taking action of the kind some opportunity should be given to the public, and to the people interested, to make a case if they can against that?
I do not think so. In fact I would like to say to the Dáil that Deputies must face realities in this matter, and if they agree to these powers being conferred I would ask them not to lead deputations asking that uneconomic, unprofitable, and nonpaying services should be continued, because it would lower the prestige of a particular town or district. Any cessation of these services is essential for the preservation of the railways. In this connection we propose not merely to ensure that there are adequate services, capable of providing for the district, but also that any railway employees displaced in consequence of such order, or rendered redundant by such order, will be compensated.
May I ask the Minister a question?
Not at this stage. I am not going to answer any more questions. Paragraph (d) of Section 8 requires some explanation. It reads:
such railway company may, notwithstanding any agreement or practice as to the dismissal (in cases of redundancy of employees) of the latest employed of its employees or as to the division of such railway company's railway system into districts for the purpose of the promotion or dismissal of employees, redistribute its employees in such manner as a ppears to such railway company to be proper, but not so as to impose any undue or unnecessary hardship on the employees of such railway company.
There is in existence, at the present time, an agreement between the railway company and the unions, based on the principle of "Last in First Out," and if a railway employee has to be dispensed with as redundant the person who was last recruited to the service is dispensed with. It may be that the company would decide that the traffic at one station did not justify the staff kept there. It does not follow that the persons at that station would be dispensed with, but some persons somewhere else in the system, who were last in. It would be necessary to transfer someone from a station where an excess staff exists in order to replace the person removed. That is a system on which I have nothing to say. It is entirely a matter for the company and the unions. If they consider that to be the most suitable arrangement that is their concern. It seems undesirable however that that system should apply where complete branch lines are closed down and the workers rendered redundant in consequence thereof. The proposal is that if the company so desires these workers should be pensioned off, and it should not be necessary for them to dismiss a corresponding number of workers who, on the "Last in, First out" principle would be the first to go all over the system and then to transfer men from the branch lines to take their places. It seems that that would impose a certain unnecessary amount of hardship on the workers themselves, and would be a procedure not justified in the circumstances. What we propose is that where branch lines are closed by order, in so far as happens to be suitable and convenient, these workers on branch lines should become entitled to compensation.
On what grounds does the Minister justify bringing a section into the Bill to abolish by law an agreement made between the workers and the railway companies?
I am not doing anything of the kind.
If the workers are transferred a week before this clause operates by what wording would they be covered?
I am not proposing to abolish any agreement.
Is the Minister entitled to take the attitude that he will not answer questions from this side, but that he will answer questions from the Labour Benches? Deputy Davis wanted to ask a question. The Minister is now answering questions from the Labour Benches.
May I inform the Deputy that the Minister is entitled to do what he likes; to answer or not to answer.
I want to know if the Minister draws a distinction between questions from other benches and from these benches?
The Labour questions are intelligent questions.
They are not getting the same type of answer.
Apparently the Minister will not reply to that. Does he draw a distinction between these benches and the Labour Benches?
I think there is quite a marked distinction.
Not in the least, having regard to the relations with the other benches and with ours.
What about John Jinks?
We can discuss in detail the provisions of this section at a later stage. I ask Deputies to bear in mind that I am not trying to upset any agreement. I am merely trying to devise a system which will cause least inconvenience and least hardship if and when an order closing or abandoning a line has to be made. Section 9 provides for the rectification of the position which resulted under the Act of 1924. It provided that the railway company should prepare for discussion with trade unions a scheme of superannuation for employees. The company prepared a scheme to which the trade unions were not prepared to agree, and the position remains at that. We are proposing in this section to bring about a position in which some third party will come in, and we propose the Railway Tribunal, in default of agreement, again. What is suggested here is that the railway company shall prepare a scheme, such scheme shall be submitted to the Tribunal; any interested parties can appear before the Tribunal and the Tribunal will fix the scheme that will operate. That scheme will be prepared with due regard to actuarial considerations.
They are going to impose that compulsorily?
I must keep to my resolution not to answer any more questions.
Have the shareholders no such rights?
And I am afraid that that applies to Deputy Good, too.
Get Deputy Davin to ask that.
I have outlined the main provisions of the Bill and explained briefly, also, the principles which underlie them. I have tried to give a picture of the conditions with which they are intended to deal. I ask Deputies to realise that it has not been an easy task to devise ways and means of dealing with these conditions but I think we can say, in some respects, that we are attempting to do here what our predecessors funked doing. It may be that the proposals before the Dáil will be capable of amendment in some particulars but I think that, in broad outline, and, in the main, they contain every provision that must be embodied in any Bill to rectify the transport position here. There is only one alternative line of approach to the transport problem and that is the line of nationalisation, and I submit that, in reality, the only essential difference between proposals for nationalisation and the proposals contained in the Bill would be that the persons in charge of the transport organisations would in one case be chosen by the owners of the railway stock, and in the other case, they would be chosen by the Minister for Industry and Commerce. In fact, I have had proposals from many parties, not dissociated from the railways, that we should, without nationalisation, nevertheless take the responsibility on ourselves of nominating the whole or a proportion of the railway directors. We have declined that responsibility.
The situation that exists here is a serious one. I would ask Deputies to realise that it cannot be remedied by any piecemeal tactics. We have got to face the fact that within twelve or eighteen months from this, unless circumstances change considerably, the railway companies will cease to work and trains will cease to run and although in those circumstances we could, under modern conditions, fend for ourselves, we are of opinion that for a considerable time to come the most economical method of transportation for a variety of classes of goods and in several parts of the country will be the railways. That is why we desire to maintain the railways and to make it possible for them to play their part in the future transport organisation of this State but to play their part as one arm of the transport system. The idea is also there to secure that those who have the direction of that system will not be actuated merely by a desire to pay dividends upon a very large amount of dead capital but that they will seek to secure the organisation of a transport system which will be efficient in every respect—something of which we in this country can be proud, something which will serve our needs efficiently and cheaply. We can get that along the lines suggested in the Bill but I say to the Dáil that, if any substantial provision as set out in either of these two Bills, is deleted or amended in any material respect, the whole scheme will fall to the ground and what I foresee is that the transport organisation of the country will become completely disorganised or else we will have, despite the difficulties to which I refer, no alternative to the method of nationalisation. I have no objection to that, as I have said, but I do not think it is the line to be taken in the present circumstances. I should like to make a prophecy here if I am entitled to do so and it is that no matter what Party is in power or what the circumstances of the future may bring the next main Transport Bill introduced by any Government will be a nationalisation proposal.
Might I ask one more question after my other numerous questions? Would the Minister consider it practicable to make a reorganisation of capital dependent on the consent of the debenture holders? I think myself that a debenture holder would be a fool not to consent, but, in principle, the abolishing of the rights of a creditor is so objectionable that I put forward that suggestion.
It would have to involve the consent of every debenture holder. There is no provision in any Act by which debenture holders can meet and, by majority vote, decide on matters of that kind. It would involve the consent of every debenture holder.
The Minister does not consider that that would be practicable?
I think it would be completely impracticable.
In accordance with the arrangement that has been come to, I want to speak only on the Second Reading which has been moved—the Second Reading of the Road Transport Bill of 1933—and to leave completely out of consideration and to fail to move at this point the amendment I have down to the Railways Bill, 1933. I want to make that segregation, following partly along the line that was accepted, if not suggested, by the Chair, because it seems to me that there are two big divisions of this subject, and the two divisions are pretty well the divisions between the measures we have before us. We are told that the railways at the moment are suffering, according to the chairman of the company, from three things, firstly, trade depression; secondly, the economic war peculiar to this country; and, thirdly, unrestricted competition. This measure is an attempt to deal with unrestricted road competition, in so far as there is unrestricted road competition still left in any matter of transport. The other Bill is the best answer the Government can give as to how best to get the railways out of the difficulty into which they have been brought by trade depression, accentuated gravely in this country by the economic war.
I should like to get this out of the way first. This is the best the Government can do with regard to the competition on the roads of vehicles carrying goods because the competition on the roads of vehicles carrying passengers was ended, so far as they could, in any administrative scheme, be ended, by the measure of 1932. First of all, it is rather amusing to get the outlook of the present Minister in comparison with the outlook he used to have on such things as competition. To-day, we are told that, in his opinion, the railways are no longer essential, and, as if that was not plain enough, he added "We can do without them." When the Road Transport Bill was before the House in 1931, in December of that year, he said:
"I think there are no Deputies who will deny that the preservation of the railways is essential to the industrial development of this country."
He has changed somewhat.
I do not say that. If the Deputy takes a sentence in what I said from its context, he can prove anything, but I did say that, although we could get on without the railways, their preservation is essential in so far as they are the most economic method of transportation available.
I hope I am not going to be asked to answer questions from the Minister's side, but what the Minister did say was that they are not essential. He said that we could do without them, but he did say that for a long time to come he believed that the railways must play a very big part. At any rate, he did found himself clearly on this statement, that they were not essential. I am only making the point that, in 1931, he called the whole House to his assistance in support of the view that the preservation of the railways was essential to the development of the country. Why the change? Apparently—it is the only example he gave—it is for this reason, that there has been a strike on in the Northern area, and along the portion of the Great Northern line which is in this country. In the olden time he said it would be called a national emergency, but now it emerges only as an inconvenience. That is the point I want to get at. That is a short view. Why would it have been an emergency previously, and why now only an inconvenience? "Because there are other forms of transport" is the answer that will occur to both of us, but wait until this measure is passed and until the unions get going, as they are bound to get going, when this legislation becomes law and when we have one big union controlling rail and road vehicle employees. If there is a strike then will it be a national emergency or merely an inconvenience? It is all right at the moment. The railways can be put out of operation.
It is not terrible from the Deputy's angle. I want to ask the Minister if he believes it will only, in those circumstances, be an inconvenience?
There could be a flood or an earthquake or a general strike.
But if the Minister does not prepare the conditions to have the flood? He cannot luckily prepare them for the earthquake. If he could, I am sure he would have done so long ago in the interests of his own Party, but he is preparing conditions here for the new national emergency. I am not saying that it is possible to avoid it. It is one of the dangers always ahead, but I say it was a shortsighted thing on the part of the Minister in introducing a Bill of this type to direct attention to the new circumstances which are very soon going to be the old circumstances. A railway strike at the moment does not matter a whole lot. Other vehicles can take the place of the railways, but let us get the railway companies and the merchandise carrying companies in control, in the main, of the road vehicles of the country, and where are we then if there is going to be a strike? I think we have a situation of national emergency once more.
The Minister is very sorry for himself in relation to all that he had to do under the 1932 Act: the licences that he had to refuse. According to the Minister, these people had to be refused licences because they could not give evidence that they had been running on the roads for a specified period. I pointed out to him that he had absolute discretion in that matter and he denied it I will refresh the Minister's memory by quoting from the Act. Section 11 of the Road Transport Act, 1932, in relation to licences, says in sub-section (1): "Subject to the provisions of this section, the Minister shall have absolute discretion to grant or to refuse an application for a passenger licence." Sub-section (2) speaks of those to whom the Minister must grant a licence. They are people who are on the roads for a certain period under certain conditions, and then sub-section (3) says: "In considering the grant or refusal of an application for a passenger licence to which the foregoing sub-section of this section does not apply"—that is to say where it is not compulsory to grant a licence—"the Minister shall"—I draw his attention to these words which are in brackets—"(without prejudice to the absolute discretion conferred on him by the first sub-section of this section) have regard to the following matters, that is to say";—then there are the terms of reference.
Does the Minister now say—I would like to have this for a ruling hereafter —that he thinks that coerces him to refuse a licence to people who apply where they cannot substantiate a claim for a licence that must be given to them, and where he thinks the service has been adequately performed by others already there? If there were unfortunate cases that broke his heart he had absolute discretion not to mortify himself but to grant them the licences they were seeking. Clearly, what was in the Minister's mind to-day was that he had to make an excuse. Although he was, as he phrased it himself, pre-election, pro-railway, he wants to have a foot in the other camp. There must be a little pro-road vehicle, and hence his tears for the licences that he had to refuse. I am glad he is operating the Act that way, but let him not break his heart about it. He can grant these licences.
In regard to what the Minister is doing in this measure, I want again to quote from the point of view he expressed in 1931 when the measure that is now an Act was under discussion. Regarding that measure the Minister said:
The Government is content that the transport services of the country should continue in the future as in the past, and be dictated for the main purpose of realising profits for the owners and not to serve industrial needs or the public convenience. To a very large extent it permits what has been described as the transport war to continue, with this exception, that in the future the Minister is going to take a hand on the side of the big battalions—the bigger companies.
Is the Minister taking a hand in a new war in this and, as he said in 1931, "on the side of the big battalions—the bigger companies?" I think he is and properly so, but it was not his opinion in December, 1931, that that should be the policy. I do not know what is going to be the result of that Bill. I think the administration of it is going to be very difficult—in its essence it is going to be more difficult than the administration of the passenger Bill because the class of vehicle is difficult. The use made of it is entirely distinct. The way in which it must ply on byroads is going to make it more difficult to discover breaches of the Act. Still, however, it is probably the best thing that could be done. All that can be done is to amend it as regards detail. Anyway it interferes with the transport situation. It is an attempt to come down on the side of the bigger companies and it is definitely successful in continuing the transport war.
Up to date we had a scheme of lorries operating on the roads without control. In the future they are to be controlled, but that control has many reservations about it. Take the exempted areas. There is a big belt of country running fifteen miles from the coast on the eastern side where the Northern Border touches the Border of this country, and right down along that eastern coast, with one gap immediately south of Dublin, it is exempted as far down as Dungarvan. Then, turning from the coast again, you have the Cork, Tralee and Limerick areas, and the area up from Westport, Galway, Ballina and Sligo. All that belt of territory is in the exempted area in which vehicles may ply without being under control. They are not to be licensed or have any restrictions on them whatsoever. The big reason given for that is that these are centres of distribution, centres of activity. They are places in fact where most traffic will originate, and in those areas the lorries are to have a free hand and are not to be subject to anything in the nature of control, supervision, or licence.
There is then a further point which, I think, aggravates the competition. We have a division made as between the existing carrier, who is not a railway company, shipping company or canal company and the existing carriers who are those things. Every existing carrier is to be licensed from this on. Remember, there is the danger always inherent in this that once you give a licence to a man you give him a better property than he had before. As long as that man continues without a licence he always had the threat made by the Minister himself in 1929 hanging over him, that such people really had no capital in an old ramshackle vehicle, and that when it was worn out there was going to be no question of paying for its renewal. Now they are going to be licensed, they are regulated. A man is entitled hereafter to think that he has a good property and ought to renew his vehicle when it gets worn out; that it is something that will have to be bought from him hereafter instead of going out in the ordinary way of competition. In regard to the existing carriers, so far as I understand from this measure, six thousand out of the eight thousand vehicles operating on the main roads belong to traders who carried, in the main, goods for the traders' own use. At least they started that way. A man bought it for his own private use; then he got into the habit of the ancillary use. For the future that man is going to be regulated in the sense that he is going to have a licence given to him and thereby be made a common carrier. In other words, he is going to be forced into trade and must take what is offered to him within these limits.
If he does that, he will be absorbed.
Why will he? They can buy him out at a price. At any rate, the company is put into the dilemma and forced to let him go on and put him into a better position because he is forced to become a common carrier against them. Either they let him go on with his condition aggravated or they purchase him out. It seems peculiar, when you start off with a measure which posits redundancy of service, that your way of mending that redundancy is to force the continuance of the redundancy or compensate these people, in order to benefit the main transport agencies of the country. At any rate, I do say that that is the new situation, and I think that that is correct. Eight thousand vehicles used to ply on the roads. Six thousand of them belonged to traders and, in the main, operated for the carrying of the traders' own stuff. For the future, those six thousand become common carriers. Within the limits of whatever is covered by the word "merchandise" they hold themselves out as common carriers and all and sundry can force the carriage of goods on them. The man who had a lorry for his own private purposes now is going to find himself a business man in the transport line. I say again that I think it is one of the big difficulties inherent in the situation. I do not see any way out of this difficulty other than the licensing system, but let us mark the dangers of it, and that is one of them. What restrictions are going to be put on this man? He is not going to be subject to the restriction of maximum charges. He is not going to be subject to the classification of merchandise. He is not subjected to the classification of merchandise or to the standard maximum charges. The only thing to which he is subject is that, having specified that his lorry is of a certain weight, he cannot increase that weight; but he can renew the vehicle. He can buy another vehicle and he is still a common carrier, as it is established here for the first time under this measure. That is what made the difficulty—these 6,000 out of 8,000 vehicles. They were the difficulty in the old situation. The 2,000 vehicles, representing the professional hauler, were not the difficulty. The big difficulty was brought about by these 6,000 privately-owned lorries carrying private people's goods, and they are now made professional. They are made professional carriers and they are not subjected to regulation. They are subjected to no restriction as to classification of merchandise and to no maximum standard of charges. The only thing is that the man cannot increase the size of the lorry.
We pass from that to the railway companies, the canal company, and the shipping company, owning road vehicles for the transport of goods. In the future, they are to be licensed. In the future, as far as they are concerned, there is going to be a classification of merchandise, and there is going to be, as there ought to be, a maximum rate for the carriage. There is going to be no standard rate, as such, or no minimum rate—no up-and-down rate which they can charge. Neither, with regard to the small fellow, who is not under licence at all. Neither is there recourse for any size of vehicle plying at any time in the exempted areas. Where is the advantage to the railway company? Once you get all these people licensed the scheme apparently is, if the railway company likes to say "I want to buy out a certain number of private lorries operating in a certain area," that the Minister can make an order and that a compulsory price may be fixed. There are two other alternatives—either that the area or the class of merchandise may be restricted. But fundamentally there is that situation. We start off with this picture:—far too many transport vehicles operating in the country, and the scheme is that you licence them all and that you permit the stronger to purchase out the others and, as part of the purchase, in certain circumstances compensate the redundant employees. And that is supposed to be for the benefit of the railway companies! Is there really much more good in the end to a company in having men on its pension books rather than on its pay rolls? That is what this comes to in part. Is that the way to enrich a business? You start off by saying "You have too many people employed in that business; you can get rid of them, but not by the method of ordinary competition or by giving better facilities or by anything like that, but that they should be handed over to you and you pay a certain purchase price, and you may have to transfer a certain number of your employees to your pension roll. At any rate, this is the best that can be done in the sense of restricting the road competition. It is completely unrestricted in these exempted areas." I fail to see yet why there should be these restricted areas. It would rather seem to me to indicate that the competition should be more restricted there than elsewhere—that the railways ought to be allowed to take that or to be given that as the cream of the business in the sense that that is the area of densest traffic. These people are not restricted. They are not common carriers inside these exempted areas. Similarly, I think— the allegation having been made that the privately-owned lorry did take the cream of the traffic—that he is now being made to stick to the cream of the traffic but to become a common carrier for it.
I am not sure that all this means any big benefit to the railway companies. Still, there is the problem to be met. The 6,000 privately-owned lorries was always the crux of this business. With regard to the 2,000 other people, possibly it would not have been a very big difficulty to see some sort of amalgamation scheme which would have allowed these people still to operate in certain areas or in certain designated types of traffic; but once you allow them to run traffic as it suited them and where everything else added was private, that was the difficulty. This Bill ought to be given its chance to see how it will improve the position of the railways. It it were brought in purely in order to aid the railways I think it could be accepted by the House. It is only when it is added to the other measure that one sees it revealed that both measures have to be taken together. There were certain smaller points in this measure that could be spoken of. It is very difficult, for instance, to see, at this time, what is the necessity for classification. May I put it in another way: if the only reason for having a classification of merchandise is in order to have maximum charges fixed, I do not see why the new Railway Tribunal should have any work given to it in that regard. It seems to me that it is ludicrous to be talking about the ascertained maximum charges for transport. Certainly, the danger is apparent, and therefore, while the railway companies do achieve what means a monopoly of transport between road and rail, then they may seek to raise it beyond that point. At the moment—and I wonder has the Minister thought over it?— and for two, three or four years to come, there is going to be no danger with regard to inequitable charges because of the height of those charges. The tendency is all the other way. Competition has driven charges to the point that undoubtedly, as far as the passenger traffic side is concerned, the service is being given at lower than cost. It is possible that even the carriage of goods has been driven down the same way.
I should like the Minister, before the debate closes, to relieve a certain amount of anxiety that is bound to be felt after the statement he made here, not precisely but somewhat unguardedly, to-night. As far as I can recollect the phrase, he said that there were stretches of main line on the Great Southern Railways unfit for traffic at greater speed than 15 to 20 miles per hour. Surely the Minister knows that the public imagination is going to have many flights on that statement. Those stretches—that was the word, I think, he used—will be magnified into large stretches or even the greater proportion of the system, and you will have people talking with simulated fear of the danger of travelling on the main line system at all.
If the Deputy will allow me I shall explain that statement now. That statement does not apply to any part of the main line. It applies only to certain sections of the branch lines and the speed observed over these sections undoubtedly leaves a fair margin for safety. Consequently there is no danger to people who may travel on these lines.
I am not talking of people who possibly may drop off travelling, but of the propagandist use that can be got out of the phrase by those who want to divert traffic from rail to road. At any rate, the Minister's statement now definitely leaves out of consideration the main lines altogether. The statement the Minister has made has no application whatever to the main lines of the Great Southern Railway system.
The branch line problem also faced the Minister. In the main he has dealt with it along the lines detailed in the 1932 Act. In so far as he has done that he has earned the hostility of the Labour Party, but in so far as he is doing it, he earns the support of this Party on the branch line business. I should like to hear the case argued, and I hope Deputy Norton will attempt before the night is over to do so, of the railway branch line which is not earning expenses—leave the hated capitalist and his dividends out of it—and why it should be continued in operation. That is a thesis put simply and I should like to hear it argued simply. If the Deputy is going to insist too rigidly on main line conditions, applying them to branch lines, it will bring about what will be a bigger harm in his mind, the closing down of the branch lines.
Cheers for Deputy Flinn.
I have not fallen to that depth yet. It is a sufficient step backwards to join the Minister to-night. The Minister—I hope to hear Deputy Norton on this and I shall listen to him with much more respect than on the last point—did not say so much to-night as bid "good-bye" to nationalisation. He only said "au revoir" to it. In fact he did not say that; he waved his hand to it. He wants Deputy Norton to think it is only "au revoir" and other people to think it is "goodbye." Look at the phrase—"nationalisation would be no more difficult and could be effected with little more trouble than this legislation." Then this was the strong foundation on which he built: he had evidence that nationalisation had not always been successful; his evidence was not complete; he would not like to say, he would not like to commit himself—I suppose while there were two or three members of the Labour Party present—to the statement that nationalisation could not be considered. Is his evidence complete enough to this point, that he can say with certainty that there is any part of the world in which nationalisation has been a success? It would please Deputy Norton and his people if that could be said, or possibly Deputy Norton could supply the answer, if it has been a success under ordinary conditions.
What about your E.S.B.?
We are speaking about the nationalisation of railways.
Would the Deputy say what he means by success?
That it has given transport under conditions comparable with the conditions that operate under the most privately owned company. I would consider that one test.
What about the Deputy's E.S.B.?
If it is allowable we can discuss it.
Is the Deputy not glad it is not allowable?
As the question of nationalisation is also not, I think. I sympathise very definitely with any Government that is called upon to deal with this side of the transport problem—the restriction of competition. We did what we could on the passenger side. We said at that time that if and when the railways showed that they were capable of handling goods traffic by road as they had shown themselves capable of handling the passenger side, then we would do the same as, under the 1932 Act, we had done on the passenger side. This follows closely enough along the lines of the other Bill. I think there are weaknesses in it. One, I confess, I have not got any explanation for. That is the matter of the exempted areas, but there has to be some attempt made to get competition restricted and I think the only way to do it is by a system of licences. I personally would like to see the measure go through even as it stands and give it a chance for a year or two. I think it should be given this chance for a year or two together with the other measure which was passed for the passenger traffic before we begin to reconstruct the company.
There are three points, we are told, that are operating against the transport agencies in the country at the moment—trade depression, the economic war peculiar to the country and unlimited competition. The Minister used a phrase here—I have not the phrase handy but it is in my mind— that it was not a wise thing to make a change over from the proprietary system to the nationalised system at a time of depression. Let me apply that test a little bit further. Why change over from the present system of the Great Southern Railway Company at a time of deep depression? That is supposing he gives the railway its chance. The passenger sides have already had their chance. After a year or two, we could then proceed, with much more equity than now, to consider what the future of the railway company should be. We are taking the railway company as it is to-day, beaten down by depression, further depressed by the economic war and suffering, at its worst point of experience from competition of an unrestricted type on the roads both in goods and traffic; and we are taking that as the best time to make the biggest change-over ever considered in regard to the railways. It is the junction of this Bill with the others to which we object. Let us leave the Bill as it stands. There are points on which I should like to see it amended though I suppose it will not be. If the railway company has stated that they think it is a good measure, if they find any optimism in regard to their future taking it with the 1932 Act, let us give them the opportunity, and then we can approach the consideration of the other Bills later.
One of the most significant things that arose in this debate, so far as it has gone, has been the unity and, indeed, almost affection generated between Deputy McGilligan and the Minister for Industry and Commerce.
Wait until the next Bill.
Deputy McGilligan said that the Minister is tackling this problem on the right lines or is endeavouring to tackle it upon lines upon which he (Deputy McGilligan) was endeavouring to tackle it. I commend to the Minister that comment as to the nature of this question of rail and road transport. After all, there are 6,000 human monuments, if not close upon 7,000 human monuments, in this country, ex-employees of the railway companies, who, through the action of Deputy McGilligan during his period of administration, lost their employment in this country. The ex-Minister pursued a certain policy and achieved that end, and now he says the Fianna Fáil Minister for Industry and Commerce is pursuing the same policy. Indeed he invites him to continue to pursue that policy, and so long as he does so he will have the support of the Opposition Party even though it begets the hostility of the Labour Party. I am not sure that things should work out on the lines that Deputy McGilligan desires. How the Minister for Industry and Commerce can reconcile his new affinity with Deputy McGilligan, with the repeated protests that the Fianna Fáil Party was a pro-railway Party, passes my comprehension. In his reply, I am sure, the Minister for Industry and Commerce will try to show the House where the reconciliation is and what is the result of it. I thought, when the Minister was speaking, of the old Roman whose eyes were always set on the high road but whose feet invariably took the low road.
The Minister now and again betrayed a flash of affection for public ownership, and the value of public ownership, and then, as if the case of public ownership was getting near, the Minister rushed away from it. He ran away from the case of public ownership which in a large measure he helped to create and fashion. The Minister told us that the public ownership had not in every case been a success. Apparently it was considered necessary to have a very successful example of public ownership in order to dislodge the hopelessly inefficient private ownership that characterises the railway system in this country. If any public undertaking had allowed the railway companies, and the railway industry, and the transport industry to degenerate in the manner that the railway and the transport industry in this country, under private ownership, has to-day degenerated, it would mean the end, I think, of that undertaking, at all events, by making a case for a public community undertaking or nationalisation undertaking. I am not dealing here with a nationalised railway undertaking. It was not a nationalised railway undertaking that produced the mess that this Bill makes a half-hearted attempt to clear up. It seems to be that private enterprise has brought this branch of transport industry in the country to this deplorable position. The Minister searched his brain to find an example of successful nationalisation, but the worst possible form of nationalisation that this country could produce was never worse and could not be worse than the gross inefficiency that characterised the private ownership of the railways in this country.
This Bill is described as a Bill to amend the law relating to railways and railway companies. It might also be added that it is a Bill to curtail the railway services in the country, because there is no doubt in the world that under the operations of the Bill, and so long as the present Minister is administering the Bill, or such portion of it as it is possible to administer by regulation, it is going to lead to the curtailment of the railway services. The Minister made that quite clear. His only justification was to ask the Deputies to face up to serious considerations that could not be avoided. I have no doubt that this Bill is going to curtail the railway services. It is going to lop off branch lines, or sections of branch lines, and I wonder what the Minister who describes his Party as a railway Party will have to say to the men who lose their positions through this Bill. What is this Bill going to do to preserve the existing employment? What is to be done for the railwaymen who are going to lose their employment under this Bill? I have no great enthusiasm for this Bill. It is nibbling with a problem which is a national, and an urgent problem, and, in my view, a problem that will not be solved by the mere passage of this Bill. We have to-day the position that the transport services of the country are in a condition of muddle and mess, and that they got into that muddle and mess by the mismanagement of private enterprise. I hope Deputy Good will remember this, and will keep it in mind, when he makes his next assault upon public ownership.
What has the Minister proposed to do? The Minister realises, and his speech was evidence of that realisation, that private enterprise in the management of the railways produced such a mess and muddle as necessitated State intervention and that they felt that if the country was to obtain an efficient transport service, and stable employment, the country must get rid of that muddle and mess of private ownership and mismanagement. Under this Bill private property and enterprise are still maintained while there is curtailment of the public services. Under this Bill the sole inducement to a proper transport service is dividends on investments. The sole inducement to maintain a transport service is to carry on a system of private enterprise which has already given adequate demonstration of its inability to provide the country with an adequate transport service. The Minister in his speech paid a few, and they were a few, compliments to public ownership. He did not, except for a few moments, attempt to say why he jettisoned public ownership. One reason was that the present Seanad would not pass a Railway Bill providing for public ownership of the railways.
I might remind the Minister that the Seanad passed a Bill providing for the virtual nationalisation of the electricity supply of the country. In any case, if the Minister thought it fit and proper to ask the Seanad to pass the Oath Bill, I think he might well have had the courage to ask the Seanad to pass a Bill which is much more important than the Oath Bill, because the livelihood of 17,000 railwaymen depends upon the results of this legislation. If the Seanad could be trusted to pass the Oath Bill the Minister might have had the courage to try the Seanad with a Railway Bill providing for public ownership. All along, however, one could not help thinking when the Minister spoke that he was sorry for some of his speeches on public ownership. If I were to suggest that now to the Minister I dare say he would repudiate that suggestion. What passed my comprehension during the Minister's speech was how he reconciled this private enterprise Bill to perpetuate inefficiency and mess and muddle with the speech he delivered in the House on the 9th December, 1931 (Official Report, Cols. 2645-46). Speaking then on the Road Transport Bill, Deputy Lemass, the present Minister for Industry and Commerce, used this language:
I think there are no Deputies who will deny that preservation of the railways is essential to the industrial development of the country.... If we are seeking to attain that aim I think we must also make up our minds that public ownership of these services is desirable if not essential. Unified control and public ownership are necessary for a number of other reasons as well.
The Deputy went on and said:
I think that as strong a case, if not a much stronger case, can be made out for the public ownership of transport services as can be made out for the public ownership of an electricity supply. The position here is that the case is also strengthened by the fact that there does not exist amongst the people of this country any feeling of confidence in the existing railway management. ...We are strongly in favour of public ownership of transport services with unified control outside the boundaries of the municipalities. Inside the boundaries of the municipalities we are in favour of municipal ownership of these services.
If the Minister reflects on that speech and remembers that in three out of five paragraphs he reiterated the view of the Fianna Fáil Party that he was in favour of public ownership of the railways and other transport services, and if he studies that speech side by side with the speech he delivered here, I think he will get some idea of the extent to which he has deteriorated in the matter of progressive views on an important public question such as this.
Three times in five paragraphs we are told that Fianna Fáil stand for public ownership of the railways and the public services. And remember, this was not on the hustings; it was not during the elections; rather was it in December of 1931 when the Minister had no eye on the election registers and no eye on the ballot papers. He made that calm, dispassionate and deliberate statement, nailing the colours of public ownership to the mast on behalf of the Fianna Fáil Party. His speech to-day represents the extent to which the Minister proposes in this Bill to honour the very explicit statements made on that occasion.
Lest it might be thought that that was an occasional lapse on the part of the Minister, just a temporary flight of fancy, we can turn to subsequent speeches. According to the "Irish Press" of 10th February, 1932, the Minister went to an important railway centre, Athlone, and used this language—it is a quotation from the "Irish Press":
The preservation of the railways was necessary and if Fianna Fáil got into power they would see at least that the railways got sufficient traffic that would make revenue cover expenses. To get that traffic some control would have to be exercised over road transport services.
...It is necessary that the present wasteful competition should be stopped and Fianna Fáil propose to stop it by unified control under public ownership. Certainly if the present conditions were allowed to continue indefinitely it was almost certain that the railways would have to close down.
That is another declaration of his fidelity in the cause of public ownership and it was delivered at Athlone on 8th February, 1932. I am not suggesting that that statement has anything about it other than the same purity and transparent honesty which characterised the Minister's previous statements.
Before he went to Athlone the present Minister went to Inchicore. I invite the House to observe the centres in which the Minister was professing sympathy for the railways. He selected the biggest railway centre in the Midlands, Athlone, and before that he went to Inchicore. According to the "Irish Press" the Minister, speaking at Inchicore on 1st February, 1932, said:—
Fianna Fáil might be described as a "Pro-Railway Party." They realised that the revival of industry could not be brought about unless the railways were preserved.
I think these quotations from the Minister's speeches amply demonstrate that in December, 1931, and in February, 1932, he believed at least in public ownership of the railways. These statements of his are definite promises, definite pledges, on behalf of his Party, not merely to the nation, but to the railway men, whose lives depend on the passage of this Bill. Those promises and pledges meant that if Fianna Fáil were in power there would be public ownership of the railways. Now we have the Minister scuttling the ship of public ownership, jettisoning public ownership, throwing it out as something to be forgotten, as a ghost that he hopes never more will haunt him in a discussion of the railway and transport situation.
There is no such thing as public ownership in this Bill; there is not even unified control. It is possible, in so far as one can read the Bill, for the same kind of chaos to go on in the future as has gone on in the past, for the same kind of inefficient management, as the Minister said in this House on 9th December, 1931, did not give the people any confidence. In the face of the Minister's previous speeches and his present day actions I hope there will be an amendment of the Fianna Fáil Party policy, and that they will delete the claim that the Party is a pro-railway Party after the introduction of this Bill.
There is not even unification provided for in the Transport Bill. Unification was a less important point in the Minister's declarations regarding the ownership and control of the transport services of the country. The Minister, however, indicated the belief that unification was going to come about. He said, in reply to an inquiry by me, that he believed such unification could be secured after the passage of the Bill. I would like to read a letter—an official letter, not marked private—sent by an official in the Minister's Department, acting in an official capacity, to a person who lost his employment on the railways. This is an extract:—
The Minister further wishes me to state that it is not proposed to secure the amalgamation of the Great Southern Railways Company with the Irish Omnibus Company and John Wallis by legislation, but in the event of such amalgamation being effected by the Boards of these Companies the position of the employees is a matter for discussion between the Companies and the Trade Unions in the first instance.
That letter is dated this month. There you have a definite declaration by the Minister that it was not proposed to secure amalgamation of these companies by legislation. Presumably the Minister is going to endeavour to secure it in some other way. But this amalgamation is desirable and if unification is desirable, and something worthy of achievement, then I suggest to the Minister that it is in this Bill he should provide for compulsory unification and amalgamation instead of allowing the matter to remain in the unsatisfactory condition in which it is and in which railway transport has been allowed to remain for too long a period.
I want to refer to some sections of the Bill. Section 2 proposes the remission of certain debts due by the company to the State. In this section a sum of £285,000 is going to be handed over as a gift to patch up and bolster up the inefficient private enterprise which has brought the railway company to the present deplorable position. The Minister and the Government are in a generous mood with regard to this debt of £285,000. Now that the Parliamentary Secretary to the Minister for Finance has arrived one cannot help wishing that this £285,000 were given to the Board of Works in order to pay a decent rate of wages instead of the starvation rate of wages which has been paid by that Department up to this time. But no. This £285,000 which the State is to hand over to the railway company is to be put in the pockets of people who at least are not in need, people who have sufficient surplus capital to keep it invested in the railway company. At the same time that the State is giving this £285,000 to people who have at least surplus capital we have another Department screwing down the rate of wages to the unChristian wage of 24/- a week. I suggest to the Minister that he ought to be careful about his generosity in this matter. If he has any generosity he can well divert it either to providing that sum of money and making it available for the relief of unemployment or paying decent rates of wages instead of the starvation rates he has been paying in other schemes of work carried out under the Department and for which a member of this Government is responsible. This £285,000 put into the coffers of the shareholders of the Southern Railways Company is our contribution, our little token of friendship towards the successful railway industry in the future. I hope that when the forthcoming Budget comes along we will see some evidence of the generosity which characterises the Government in its attitude towards private enterprise of this kind. When the Budget is being framed, at least the Minister for Industry, if not the Minister for Finance will remember the nice cheque he has to hand over to the Southern Railways Company as his token of good-will and his little present to the new bride. I hope somebody will remember the attitude of the Government towards private enterprise then. I hope somebody will examine his conscience and I hope somebody will justify his low rates of wages towards some of the people who need the money at least as badly as some of the people for whom the Minister spoke this evening.
Another section of this Bill is Section 8. This section is the section which is going to guillotine branch lines and sections of branch lines. This whole section seems to me to indicate a complete want of faith in the future railway services of this country. Under this section the Minister is empowered on the application of the railway company, to grant permission for the closing down of a railway line, the only conditions being that the Minister must be satisfied that an alternative method of road transport is provided. Once the railway company says "we want to close down a certain section of a line," all they have to say to the Minister is to tell him that a bus, or so many buses will run on that line. Thereupon the line will be closed. Presumably it is within the discretion of the Minister to close down that line. No more trains will run upon the line. Instead an alternative system of transport will be provided. Railwaymen will lose their employment. The railway line will cease to operate as the source of the conveyance of goods, and instead we will have buses put on the roads in order to carry the traffic which in the ordinary course, and in all common sense, the railways ought to carry.
I want to invite the Minister's attention for a few moments to what he is doing. His speech makes it clear that he is very definite in his proposals to permit the railway company to close down branch lines or sections of branch lines. That means that the iron road is of no more use for the purpose of conveying merchandise or passenger traffic. The road will be used no more as a means of transport, though we have that iron road there fitted in every respect as a medium of transport. The Minister, however, proposes to allow it to go out of use. Instead he proposes to allow buses to be run on the roads, which were never intended and which were never built for buses— on roads on which buses were never intended to ply. That will mean greater cost and greater expenditure to the taxpayer, while at the same time the normal road, the existing road, the iron road is there as a medium of transport. Yet it is proposed under this Bill to permit the closing down of the iron road to enable more buses to ply on the roads which were never built to accommodate such traffic.
In the Railway (Miscellaneous) Act, of 1932, there was some provision for an inquiry in certain places. An inquiry was to be held in certain cases at the expense of the railway company. What has happened under this section? This section makes it easier and cheaper for the railway company to close branch lines. That is the Minister's contribution as a member of a pro-railway Party towards maintaining the railway services of this country. There is no suggestion in the Bill that the local people ought to be consulted, or that a local inquiry ought to be held. The inquiry which hitherto should be held has now been discontinued. Instead of that inquiry the whole responsibility for closing branch lines and sections of branch lines rests on the sweet will of the Minister. The Minister's will has been exposed by his speech this evening. God help the branch lines, because they will have very short shrift if the Minister's speech this evening is any indication of what is to happen. The Minister said, and he was supported in this by Deputy McGilligan, that it would be unreasonable to ask the railway companies to run branch lines at a loss. Therefore, we can have branch services and railway services only where it is possible to make a profit. The travelling public may make a profit of £250,000 a year for the whole Great Southern Railways, but if there is one branch line where there is a loss of £1,000, under the Minister's and Deputy McGilligan's philosophy, that loss of £1,000 on that line is enough to close it, even though there has been a profit of £250,000 on the whole system.
Will the Deputy argue the case where you are making a profit on no part of the line but a definite loss?
This Bill is not dealing with the railway muddle and mess of the past. This is a Bill for which the Minister claims perfection. This Bill is something to put the railways on a proper basis, something to make dividends available and profits available in the future. We must judge this Bill on the Minister's basis—that the railways are presumed in the future to pay.
A number of these branch lines never paid since the day they were constructed.
Have you seen the figures?
The whole undertaking will be owned and controlled by the Great Southern Railways Company.
Will Deputy Norton admit that it is ever justifiable to close down any branch line and, if so, under what circumstances?
I should not normally have expected that in a matter of this kind—public policy as regards transport services—the Minister would see eye to eye with Deputy MacDermot.
Deputy MacDermot has expressed no opinion. He has asked a very simple question.
Fortunately or unfortunately, I had an opportunity of reading the stock election address of one of the Deputy's candidates at the last election. I know that the Deputy's outlook on life is bounded north, south, east and west by unbridled and unrestrained individualism. I had hopes that the Minister would not be found in that company. In his gyrations on this question of transport, the Minister is finding himself in exceedingly queer company.
I hope that Deputy Norton is not forgetting my question.
I say that this provision is a deliberate incitement to the railway companies to lop off branch lines or sections of branch lines. It makes it easy and cheap for them to do that. On the Committee Stage of this Bill, I am going to endeavour to have an amendment accepted which will prevent this being permitted unless it can be shown that the general financial position of the company—not merely the position of a branch line—is such as by sheer necessity to justify the closing of a branch line. In view of the Minister's speech, I imagine that it is possible for a company to make a profit on its whole system and to lop off an unremunerative section because it means less dividends to the shareholders, although it means employment to railway men. I should rather see the Minister trying to make the railway companies popularise the rail services and make the branch lines attractive to the public and at the same time taking all possible steps to restrain unregulated competition which, in many areas and in a great number of cases, has been responsible for making branch lines unremunerative.
I want to pass from the Railway Bill to the Road Transport Bill. Like Deputy McGilligan, I am rather amazed at the section under which carrying companies and carriers—those who hold merchandise licences—who operate within a radius of 15 miles of twelve of the largest towns and cities are completely exempt from the scope of the Bill. As Deputy McGilligan said, if you get a map of Ireland and mark the areas which are exempt, it will seem as if the Minister is exempting the centres where the traffic and population are densest and is quite content to rely upon the regulation of transport in the thinly populated areas. How a Bill entitled "An Act to make further and better provision for the regulation and control of the carriage of passengers, merchandise and mails by road" can be so described when areas of large population and of considerable transport conveyance will be exempt from its scope, passes my comprehension. I suggest to the Minister that all these areas should be brought within the scope of the Bill. If we are going to have regulation of the passenger and goods carrying companies, for heaven's sake let us have it for the whole country. The country is small enough without having twelve 15-mile circuits excluded from the Bill where unbridled, unregulated transport can go on. If the Minister measures the total area involved and has regard to the population in these twelve centres, he will see that a very considerable portion of the country and a very considerable proportion of the population will be outside the terms of this Bill, which claims to make further and better provision for the regulation of transport services. This is making confusion worse confounded, because here you will have legal authority for chaos. In the past, one could say that the chaos was due to absence of control. Here, you are putting a legal hall-mark upon a form of chaos in the transport services which, in its immensity, will ultimately disturb the Minister's serenity. If that provision remains, the idea that transport can be controlled will be nothing more than a delusion.
I pass now to Section 14 of the Bill. Under this section, it is possible for persons to make application for merchandise licences, and the Minister in granting the licences is, if he thinks fit, to advert to the wages and conditions of employment of employees engaged in the operation of the vehicles used for the purposes of the licensee's business of merchandise transport by road. Apparently, the Minister is to see what the wages and conditions are. He is not obliged to make sure that they are decent wages and conditions. He is obliged just to have a look at them. With my experience of some of the people who got licences to operate buses under the Act of last year, I am very sceptical about giving the Minister this kind of perfunctory power under this section. It is very desirable that people who get road licences from the State and the value of whose undertakings is automatically enhanced by reason of the licences—it is very desirable that these people should have to recognise a certain standard as regards wages and conditions. On Committee Stage, I shall endeavour to secure that a certain standard wage will have to be paid by these people if they are going to have the value of their undertakings enhanced by the State and if they are going to be allowed to ply for hire on the roads of the country. Similarly, I shall endeavour to have an amendment inserted to prevent people being employed to drive these licensed vehicles for 56, 60 or 72 hours a week. In these circumstances, drivers run the danger of falling asleep at the wheel. People who use the highways are in danger of being run down and killed. I hope that the Minister will see his way on Committee Stage to accept amendments which will ensure that something like civilised standards of employment will obtain in these public services.
I do not think, A Leas-Chinn Comhairle, that I have much more to say on this Bill, but in my concluding remarks I do want to say that it is far from being a pro-Railway Bill. It is far from implementing the promises and declarations made by the Minister for Industry and Commerce, and made by other members of his Party. It is not providing for public ownership. It is providing for an anæmic, sickly kind of private ownership, which I prophesy here to-night will give to the transport services of the country the same messing and blundering which private enterprises gave in the past. Speaking on behalf of this Party, I am sorry the Minister has seen fit to stand over a Bill of this kind, which is completely at variance with his previous declarations, and which is of such a milk and water useless character that it has even earned the benediction of Deputy McGilligan.
I think, sir, that the Minister will be coming to us on the Committee Stage to explain that he did the exact opposite to what he had intended to do when he marked out exempted areas. He told us that this Transport Bill is meant to be a piece of machinery in the hands of those in control of the railway system in the country at present, by which they can acquire a monopoly of all forms of transport. He thinks that that monopoly must be brought about quickly—that delay will bring such damage in its trail and create such dangers to the safety of the railway traffic in the country that he would be driven to introduce a measure nationalising the whole transport system of the country, in spite of the fact that he considers if nationalisation brought about a transport system it could only be maintained, in the beginning at any rate, with very great subventions from the public funds.
If we are to look around and see where the principal centres of merchandise-carrying lie, I think the Minister will admit that they lie around the twelve or thirteen areas which he has marked "exempted areas," and instead of giving the railway company or whatever shipping companies he has in mind an opportunity of completely taking over the transport of merchandise right away in those areas he proposes, under this Bill, to leave them subject to indiscriminate competition. One of his charges against the Party on these benches is that it failed to stop unrestricted competition against the railways, and here around the principal centres where merchandise will arise for carrying or is arising at the present moment he maintains areas of unrestricted competition. I think, as I said, that he will be coming to us to say that this scheme should be reversed—that what he intended was to apply this measure of restriction strictly to these areas, and that, given no competition inside these areas in the matter of carrying, the principal railway companies with the advantage that they had inside these areas would be able to compete successfully against unrestricted competition outside. The Minister, it seems to me, dealt only by chance with the exempted areas, and what explanation he gave us of the idea was no explanation at all.
He spoke of Dublin, and said he thought it might be reasonable that there should be a suburban distribution scheme in Dublin. Well, perhaps there might be a suburban distribution scheme in Dublin that would be separate for the city in the same way as, say, the tramway company is separate from the railway system, but personally I would see no advantage in that. If we are thinking in terms of a national transport system I would like to hear the Minister make a case for having a suburban system of transportation of merchandise in Dublin that was unrelated either in its organisation or in its finances to the transport system of the rest of the country. Surely he does not anticipate the development of a suburban distribution system in Ballina, and yet we are provided on the Mayo-Sligo coast with a ring of centres locking into one another and completely cutting of, say, the Belmullet area. The railway company is being told to-day, "This is your chance of taking complete control over the carrying of merchandise in the country. We are going to allow you unrestricted control except in so far as there may be existing carriers. We are going to see at any rate that no further transport system will grow up in Belmullet, but any opposing system that likes may grow up in the belt that comes along Sligo, Ballina and Westport." Again I suggest that the Minister has turned his whole scheme, as far as this idea is concerned, inside out. If not, he apparently will have to face opposition from the Labour Benches on this scheme, and I think he will have to face opposition from these benches or be driven to a greater and more convincing explanation of what the idea of these exempted areas is. I do not know if the Minister slipped when he remarked that "Centres of production are likely to be less numerous than centres of importation." The Minister said that?
In relation to quite a number of products.
So that it might in some circumstances be taken as a commentary on the economic war and the industrial development here, but at any rate the Minister stands over the statement that centres of production are likely to be less numerous than centres of importation. The Limerick marketing centre is a marketing centre, say, for Clare in regard to a very considerable number of items. Whatever national transport system, or transport system tending to be a national one, is going to serve from Limerick to people around Ennis and the middle of Clare, it is expected to give full and satisfactory service, and gradually to take over all that service around the mid-Clare area, while being cut off from a large amount of the transport lying close around Limerick city. I submit to the Minister that to ask the railway company so to develop itself as to take control of all the transport system in that area, and inside a reasonable space of time, is to treat the situation very lightly and to show that he does not consider the position with regard to transport as a serious position in the country. My opinion is that if a Party or a group of people do not put a national transport system in the country we are going to have a new and unrestricted transport quoting high charges and taking the cream of the distributing trade around the main centres. I think the people who are asked to do that cannot make a success of the thing which they are asked to undertake and I feel that the Minister must for some purely politic purpose understand that this proposal will undoubtedly meet with opposition from every Party in the House and is avoiding taking upon himself responsibility for it.
Deputy McGilligan mentioned 6,000 private lorries which are operating in the country. I would suggest to the Minister that the greater part of these 6,000 lorries are operating inside the areas which he has marked as exempted areas, and that not only is there the possibility of new transport services arising inside these areas but the greater part of the people claiming to be existing persons asking for a licence as existing persons. Now, the greater part of these are also inside these areas, so that with the amount of restriction which lies on these people and on all new people as regards the class of merchandise they shall elect to carry with that restriction on them and without any restriction as to new groups, the principal carrying services in the State are likely to lose the cream of the carrying trade of these important centres.
I propose to confine what I have to say to Section 8 of this Bill, which has already been referred to by Deputy Norton. I do say that the effect of this section, taken in conjunction with the Minister's speech, are going to have very particular interest for the county I represent, and more particular interest still for the constituency I represent in this House. I think in that constituency to-morrow morning railway users, and more particularly railway men, will read with dismay what the Minister has stated here this evening. It seems to me that if the Bill goes through in the form in which the Minister has introduced it in this House, and in the spirit of the speech which we have heard this evening, the death warrant of all the branch lines is already signed. They have been watched, tried and condemned, and I certainly will do my part to defeat the Minister's intention on that matter on another occasion in this House. Four or five branch lines in West Cork will disappear if the Bill is not changed on the Committee Stage. The Minister mentioned that during the last twelve months he had no applications for the closing down of services, but that he had applications for the curtailment of services. In West Cork, the one important town in that constituency has its branch service completely taken away. I am not sure of the date, but the Minister is aware of the district to which I refer——
In that case there was no necessity to get an order.
I quite appreciate that, but I am pointing out what has happened, and I am pointing out the danger of what is likely to happen with much greater force if this Bill goes through. Now, of course, this proposal is recommended with the solace of compensation for railway men. Well, those of us who have been in this House since 1924 know that the story of the old compensation that has been awarded to railway men is a particularly sorry story. We are aware of the fact that hundreds of railway men have received no compensation whatever; we are aware of the fact that large numbers of railway men have not yet had an opportunity of having their cases investigated; we are further aware of the fact that for a very long period there has been no tribunal available to investigate the cases of railway men who have been disemployed. The Minister is aware that in connection with the Railways Act, 1924, which was made infinitely worse from the railways point of view by the Act of 1926, an opportunity was provided to reject hundreds of claims of railway men on the question as to whether their positions were made redundant under the Amalgamation Scheme or not. I now notice that in Section 8 of this Bill the proposal dealing with the redistribution of railway servants carries with it a delightfully vague promise that cannot be made operative when it causes undue hardship, and that delightfully vague undue hardship is just on a par with certain phrases of a similar kind which were enshrined in previous legislation, as railway men, who are still without compensation, are very bitterly aware of. I do not propose to make any further reference to the Bill as a whole. I intend to do what I can to defeat this proposal, and I feel I will have the active support of my colleagues in County Cork, and of all Parties in my endeavour to do that. I think it will be a disaster if the mentality shown in the Minister's speech this evening was allowed to get a free play in the matter of dealing with branch lines in the future.
The Minister asks us not to lead any deputation to his Department in connection with this matter. The whole thing is to be settled in this Bill. Well, we will see. I certainly think that the Minister will be convinced before this Bill finally leaves the House that this is an entirely unwise provision. It is made worse because of this fact, that in 1924 most of the branch lines in County Cork, which I am referring to, were the baronial guaranteed and were to continue for 10 years from the period of the passage of the Railways Act, 1924. The ratepayers in County Cork have been paying substantial sums since 1924 in the hope and in the promise contained in the previous Railways Act. The guarantee disappears next year, and if the Minister has his way the branch lines will also disappear. I consider that that is a breach of faith with the ratepayers in that part of the country. In addition to the death sentence of large numbers of railway men the people will be able to measure, at its proper worth, the promises of support which were so enthusiastically extended to them some years ago. They will possibly compare the delightful promises made to them with the realities contained in this Bill, and I feel that they will be justified in urging their representatives in this House to resist in every way the proposals contained in this particular section of the Bill. They are extremely harsh and, in my opinion, too drastic, because, at least, the public railway users and the people generally would be entitled to hear the case for the closing down of branch lines and a public inquiry made before this should be adopted. If they are to be done in this way then I think the House ought to have something to say in the matter before it decides to give power of that kind to the Minister, because the Minister has indicated in no uncertain way how he will use his power under Section 8 if he gets the necessary support from this House.
So far as I can see, and so far as I followed the speeches up to the present, there is not a general appreciation by Deputies of the full effects of the Bill, or the tremendous consequences that it is going to have with regard to the life of the people throughout the country. Either I am out of step, or nobody else is in step. Certainly if, for instance, Deputy MacDermot read the Bill as I have read it, I think he would have been on his feet long before this. I think the Road Transport Bill, for instance, is going to have very serious effects for farmers. While I intend to vote for both Bills, I do not do so with any enthusiasm. I will vote for them simply because they seem to be on the lines that the Great Southern Railways Company desire, on the lines they believe are necessary for their existence and because, apparently, the Bills are the best that the Departments can produce to deal with this problem. Of course, I think everyone will agree that it is probably the most difficult problem that has ever come before the House; it is certainly the most difficult technical problem which has come before the House in my time.
As regards the Railways Bill, I will offer this criticism. I do not understand why the Minister has adhered to the curious principle of standard revenue, a thing that is not native to this country, that is borrowed from another country, and that has always been faulty as an item in the system of control of railway charges and as an item in railway economy. I do not understand why he is adhering to it, particularly in view of the reason he gave for adhering to it. His reason is, so far as I followed him, that if there is not that standard revenue to act as a criterion to the Railway Tribunal there will be all sorts of extravagant charges insisted upon by the railway company and all sorts of extravagant acts by that company that will interfere with travellers' and traders' rights. At the same time, he is taking power in the Road Transport Bill to see that the community does not get the benefit of the cheapest services offered to them. So that the two Bills are in opposition in that respect. The system of standard revenue is adhered to in order to protect the public against extravagant charges by the railway company, and the whole principle of the Road Transport Bill is to do away with these people who were the pioneers of road transport in the country in order that the Great Southern Railways Company may be able to get a revenue from road transport. I do not understand how these two things can be defended in two Bills which are going through at the same time and which are intended to serve the same purposes.
There is a further criticism that I would offer in relation to the Railways Bill. With regard to Section 8, I asked the Minister already why he did not put in a provision to enable the railway company to take up a line the closing of which is authorised by him. Why keep the line there as a curiosity? Why not give the company power to transform that line into a road, reserved, if you like, for motor traffic, on which perhaps they could charge special tolls or something of that kind? Not only is the line to be kept intact, but the company are not to be relieved from any liability to maintain bridges, level crossings, fences, drains, and other works constructed and maintained for the use, accommodation or protection of the public generally, or any section of the public, or of the owners or occupiers of particular land. I really do not see why the power to take up the line and substitute a road therefor is not given to the railway company.
Further, in connection with the same section, I suggest that an adequate substitute for the railway service is altogether too vague a term. The Minister is to determine, apparently, whether the road service that the railway company will offer will be an adequate substitute. I think the House should have something to say on the question of whether the road service that must be provided before the branch line is closed is an adequate substitute or not. How near would the road service have to go to the railway line in order to be an adequate substitute? One of the branches, for instance, that I see being closed inevitably under the Bill is the Naas-Tullow branch which goes through Dunlavin, Colbinstown, Grangecon, Baltinglass and Rathvilly. I should like to know whether the idea of this section is that the road service to be substituted for that branch line must run within a certain distance of the railway, must be parallel, and take in each village served at present by the railway. If not, the Minister will find very great discontent amongst the traders and people generally of these villages. If it is, I do not know how it will be managed, because part of the public road parallel to that line would not be wide enough or at all suitable for heavy lorry or bus traffic. I do not know how the section is going to be made practicable. As I say, that is inevitably one of the first branches that will arise for consideration under the section, and from my knowledge of the area, I could not imagine any road service going from Naas to Tullow that could be regarded by the Minister or anybody else as affording an adequate substitute for the railway service which will be done away with.
You can make a new road at the ratepayers' expense.
I should like to hear the Minister on that subject. At all events, that section will require a lot of investigation in Committee, unless the Minister in his reply gives us his ideas upon it. A further but rather minor point in connection with the same thing is that the Minister is not going to approve of this road service until he is satisfied, first of all, that it is adequate and until it has been advertised to the public. That seems rather an anomalous thing to do. The railway company must advertise their intention to close the line and substitute a road service. After they have advertised it, the Minister can say that the scheme is not adequate and that he does not approve of it. The railway company are required to give the public notice of their intention before they submit the scheme to the Minister, or before he considers it. That looks too much like putting the cart before the horse. I should imagine that before they advertise to the public they should have provisional sanction at least to the scheme.
We now come to the Road Transport Bill. In connection with that, in my opinion, Deputy McGilligan's criticism was all based on a totally wrong assumption. He assumed that the 6,000 private vehicles which have been the trouble for years past would now become public vehicles while remaining in private hands. From the Minister's speech, however, and from the idea of the Bill, if the owners of the private vehicles take out licences it is inevitable that the vehicles will at once pass into the hands of the Great Southern Railways Company. Once they have taken out a licence as public carriers the Great Southern Railways Company can apply to take them over and, as far as I can see, the Bill puts no hindrance to that being done.
Is the Deputy aware that the Great Southern Railways Company as such is not a carrying company at the moment?
I do not know what it is as such. The Minister told us in his speech that what he looks forward to is the absorption of all the private commercial road services by the Great Southern Company.
What he hopes for.
That is the intention of the Bill, and we must base our criticisms on that assumption. We have to decide first whether that is likely to be achieved by the Bill. If it is likely to be achieved, what is going to be the position afterwards? That is the point.
Live horse and you will get grass.
Does the Deputy not understand that most of these traders are carrying a large percentage of their own goods and that only a part of their work is for other people? If the railway company bought them out they would only be buying out a percentage of the trade because these traders could purchase other ton lorries for their business.
I understand that perfectly. That is the kernel of my criticism. I met a man in Dublin last week, a constituent of mine, who owns a lorry. He brought up a load of potatoes for a neighbour and he was going to bring back groceries and other things to sell in his shop. When the Bill is passed he will not be allowed to carry that load to Dublin.
Not for his neighbour. The load I mentioned was for a neighbour and was done for hire.
He did it for love.
He can get a licence. He cannot be refused.
Once he gets a licence the Great Southern Company can serve him with a notice that they want to buy him out.
He can bring groceries back.
The potatoes belonged to his neighbour but the groceries were his own and were for sale in his shop. If the Bill is passed as it stands—and this is most important from the point of view of the people in the country— that man would have to refuse to convey a lorry load of potatoes to Dublin, even though his neighbour may not otherwise be able to sell them. While the charges of the public carrying company that will have the monopoly of transport may be moderate, the owner of the potatoes could not possibly send them by road at present prices unless the charges were extremely low. We all know that if potatoes are to be sold at present at any profit the charge for conveyance will have to be infinitesimal. The one chance that the man who produces potatoes had to sell them was to get them brought to Dublin cheaply.
I do not say for nothing, but for very little, if he were to have a reasonable opportunity of selling them. When this Bill is passed traffic of that kind must stop. No matter what the position, and no matter what offer is made to the lorry owner who is not a licensed carrier, he must refuse it. If a farmer has a beast with a broken leg, and if he wants to get it to the butcher quickly he cannot ask the lorry owner to carry it. If a farmer wants to get a beast to a fair urgently, and if he asks his neighbour to help him by hiring his lorry, that man dare not do so. Look at the consequences, and how it hits the amenities and conveniences that have grown up and become part of farming life in this country. As a matter of fact, what it means is that door-to-door traffic is to be stopped definitely.
Not at all.
The Deputy is right.
Occasional traffic by motor is also stopped. Once a man who has a lorry for his own use is forbidden under a penalty of £50 to convey traffic for hire, then you may take it that the ordinary farming community will not be able to utilise motor vehicles, particularly to load in their own yards or farms. Does Deputy Davin think that when private carriers are wiped out in areas where they were the only carrying companies, that a farmer can attempt, with present prices and circumstances, to bargain with one of the public carrying companies for a vehicle to come to his yard to convey cattle to the market at a reasonable price? As a matter of fact, these companies will not be prepared to send lorries at suitable times in the mornings. A public carrying company with headquarters in Dublin could not send a vehicle to a farmer at such a time as would enable him to get his cattle to a fair.
That is the most elastic interpretation I have heard.
When Deputy Davin is speaking he can find fault with my reading of the Bill and point out where I am wrong in this respect. If the Deputy goes over the provisions, and if he takes into account what the Minister expects to happen under the Bill, he will find that there will be all these difficulties. The Bill is going to have a very serious effect on the farming community, particularly in certain counties. It is certainly going to cause tremendous inconvenience and loss in the county I represent. Consider the country between Blessington and Baltinglass, where there are about 12,000 people. Practically speaking, for the last 10 or 12 years they were dependent entirely on motor traffic, which was largely done by shopkeepers in order to dispose of what they produced or to secure what they required. These shopkeepers are now placed in the dilemma that they have to license or not. If they are not licensed they cannot carry any traffic but their own. If they are licensed they become liable to be bought up, and they cannot protest against it. There is no appeal against any proposal of purchase by the Great Southern Railways or the other public carrying companies.
Obviously, once you have public carrying companies instead of the small carriers, they will confine themselves to main roads, instead of going to the back and to the difficult roads which the small independent carriers penetrated. They will, no doubt, be prepared to stop at certain hours and at certain cross-roads to take up milk, or live-stock, or agricultural produce. Does Deputy Davin think, when you have that position, that it will be possible for the ordinary farmer to bargain with such companies for a motor vehicle to go to his yard to convey produce or live-stock to a fair, no matter what the circumstances? Does the Deputy think, no matter what the standard charges are, that public carrying companies will fix such charges for services of that kind as will make it possible for ordinary farmers to avail of them?
Could they not write to the Rates Tribunal?
The Rates Tribunal surely cannot deal with particular cases such as the case of a man who says "I want you to come to my house." How could it? Surely Deputy Davin does not expect that the Rates Tribunal will be able to deal with each individual farmer, or that it will attempt even to impose standard charges for by-roads? How could it without taking into account the state of the roads, the hills, or the difficulty of getting to the farmer's house? All that the Rates Tribunal can do is to impose standard charges for the main roads, and I am sure that, if the Minister were here, he would admit that that was so.
That is not in the Bill.
In face of these difficulties, it is amazing, as I say, that there is not a bigger outery on the part of those who are, by profession, at all events, standing for the farmers' interests and the farmers' rights. Even with regard to industrial development, that is so dear to the Minister's heart, I can see cases in which industrial development is going to be very seriously impeded and where the production of industrial products is going very seriously to be interfered with under this Bill. For instance, Ballyknockan Quarry is some 25 miles from Dublin. About seven leaseholders operate in that quarry and one only has lorries. The only transport that is possible from there to Dublin is road transport. Up to the present, the small man who was preparing a slab, public monument, or a thing like that, could say to the man with the lorry: "Would you convey that to Glasnevin or elsewhere for me," and the transaction could be arranged for 5/-; but now the man with the lorries has to refuse. He has to tell him: "Begone, Satan, I am not prepared to pay a fine of £50 for committing an offence like that," and the man who is doing a little bit of work like dressing a slab or preparing a public monument has to find some independent means of transport, because I can tell you that unless we pass a law—and I doubt if we could do it even by passing a law—compelling a public carrying company to go to Ballyknockan, we certainly will never get a public carrying company to bring vehicles to Ballyknockan, because no charge they would ever get would pay for going there.
You have all these curious snags in the Bill and these difficulties to contend with. I wonder if, when the Bill has been passed, when all this curious, cumbrous machinery is in operation and the Great Southern Railways Company has bought out all these small carriers and has provided compensation for the owners and employment for the employees, and everything else, will the revenue to the railway company be so much greater? Hateful and undesirable as subsidies are, in my opinion, a subsidy to the railway company would be a better method of meeting the present difficulty. At all events, you would know what you were doing and you would know what the country had to pay to help the railways to keep alive. Under these Bills, there is no possibility of knowing that. If the circumstances I have tried to describe are a fair description of what will prevail when this Bill is in operation, then we will never know what the Bill will cost. We only know that it will cause so much inconvenience, that it will mean such a restriction of private right and natural economy that people will probably revolt against it and that evasion of its enactments will be general and complete. In face of that, I say that it would be well worth while for us to consider, since this is not a controversial matter, whether it would not be better to pay a subsidy of a certain amount to the railway company for, say, five years to enable it to keep going rather than face the uncertainty, the great inconvenience and the great difficulty that will arise from the operation of these Bills.
I am going to say only a very few words of general support of these Bills. They, in effect, establish a monopoly and a monopoly is a thing that I instinctively dislike, as does Deputy Moore. It carries with it all sorts of disadvantages such as he has been pointing out, but I do not see any alternative in the present transport situation in this country. He has suggested a subsidy. There are a number of obvious objections to that but I would mention, among others, that, if a cash subsidy were paid out to the railway company, year by year, it seems to me that our friends on the Labour Benches would see that every penny of it was spent in keeping up uneconomic rates of wages to railway servants.
What is "uneconomic?"
Rates of wages that are vastly in excess, compared with those of other classes of the community, of what might reasonably be expected, and, in that connection, I might refer to Deputy Norton's remarks as to the inefficiency of railway management. It may be that inefficiency of railway management has had something to say in bringing the railways to their present condition. It is not very easy for me to judge to what extent that is true, but I feel that there is an equally strong case for saying that interference by the hide-bound reactionaries on the Labour Benches, and their followers and friends in the country had a good deal to do with bringing the railways to their present state, because there is no doubt that the most hide-bound reactionaries in this House do sit on the Labour Benches. They have not an idea in their minds that is less than 50 years old. They seem to be incapable of facing unpleasant facts or bringing any sort of freshness to bear on a new situation and, while I know that this Bill provides for a certain change as regards the management of the railway, by the introduction of this system of postal voting—how that will work out is hard to judge—it does not provide any change in respect of the tyranny that the Labour Party has exerted in the past over the railways in this country. I see no reason for hoping that that tyranny will be diminished by these Bills. That is one of the bad features of the situation and I may say that I even have a hankering for their favourite solution of nationalisation because I think there would be a little more chance of railways conducted by the Minister for Industry and Commerce being run with a certain amount of freedom from dictation by the Labour Party than there is of the unfortunate railway directors being free from such dictation.
As regards the reduction of capital, I must say that I rather sympathise with the Minister for Industry and Commerce when he says that it seems to him that an undue proportion of the attention which these measures have attracted has been given to that particular feature, because I do think that the writing down of the capital really comes to a question of facing the facts, which has got to be done, and I regret that it should be necessary to take coercive action with regard to debenture holders, who are not stock-holders, but are really creditors of the company, and stand in a special position, but, in view of what the Minister has said, I am prepared to accept it that, under present circumstances, it is inevitable. I think, though, that we must try to free ourselves from any illusions on the subject of what can be accomplished by legislation with regard to the transport position. Only a very modest amount can be accomplished by such legislation as this. The real trouble is, of course, the economic condition of the country, and one specially aggravating feature of that economic condition is the so-called economic war which the Labour Party are largely responsible for.
I thank the Deputy very much.
I intervene at this juncture in order to give the Minister a decent opportunity of replying to the various strictures passed on the two measures before the House. I am tempted to intervene now because of the rather bit-each-way speech of the leader of the Abstentionist Party, who has sought to damn with faint praise both measures. I am now in the same doubt as to how the Leader of that Party is going to vote as I was on the occasion of the election of the President. I would like to ask the leader of the Abstentionist Party what he proposes to do on either of these measures. He has made a very good speech in favour of the amendment down in the name of Deputy McGilligan, at the same time giving his blessing to the measure introduced by the Minister.
In all the speeches made on these Bills no reference whatever has been made to the extravagant pensions paid to certain retired officials in the railway service. We have relatively big pensions paid to persons who were important officials in the railway service, while little or no recognition by way of pension has been given to old and faithful persons who occupied minor positions in the service. Deputy Davin possibly may give the House statistics in relation to that aspect of the question.
I am aware that old railway servants, such as guards, checkers and others, have been retired on very small pensions of seven, eight and nine shillings a week, while we have people who were station-masters retired on relatively big pensions, and managers of railway systems operating over distances of something like fourteen or fifteen miles retiring on pensions of six, seven and eight hundred a year. No attempt has been made in this measure to deal with that position. We have had comparatively young men retired on fairly liberal pensions, while, as I have just said, men with very long service have been retired on pensions as low as six, seven and eight shillings a week. In that connection, might I point out to the Minister that because they are in receipt of these small pensions they are debarred from enjoying the full fruits of the Old Age Pensions Acts passed by this House in the last couple of years.
I feel, with Deputy Murphy and some other Deputies who have spoken, that the fly in the ointment in relation to the Railways Bill is Section 8, which deals with the discontinuance of certain train services. We had a railway service operating between Cork and Crosshaven, very important and populous centres. It was discontinued because it was found to be uneconomic. In any branch of industry, whether it be a drapery warehouse, a railway or a shipping service, there will be some departments which will not, on their own, pay their way. I do not deny for a moment that the service between Cork, Passage and Crosshaven was uneconomic. In other words it did not pay, but at the same time I think it will be obvious to anybody interested in the transport system of the country that, over a very long period of years, the railways operating under the Great Southern system were not a paying proposition. There is no use now in adverting to the fact that the directors mismanaged things very badly in allowing a competitive road service to flourish, making no attempt themselves to deal with this new phase of transport in the country.
Deputy Moore, in my view, touched the real kernel of the whole situation. We all must face up to the fact that a new transport service has been allowed to develop in this country. Whether it is good, bad or indifferent, there it is. The fact is that in the country districts the farmer who wants to sell his pigs, or to send his agricultural produce to the market, has a motor lorry at his back door, with the result that there is only the one transhipment, so to speak, of the produce he has to sell until it is delivered at the factory or the market place. This Bill does not adequately safeguard the position of the railway system in providing an alternative to that particular kind of traffic, and my sympathy goes out to the Minister. I see and appreciate his difficulty. This measure, in my view, at any rate, is an attempt—I think it is admitted even by certain members of the Labour Party that it is some attempt—to meet that particular difficulty.
I confess that I see in the statement of Deputy Norton a good deal of commonsense. I find myself in agreement with him that some further inquiry should be made. When the Minister is replying, I would like to hear what answer he has to make to the criticisms of Deputy Moore and Deputy Norton. I appreciate, as I have said, the Minister's difficulty, but I feel that further inquiry should be made, because while the attempt made by the Minister in this Bill to solve this big problem is a decent effort, at the same time he should have due regard to the criticisms offered even by members of his own Party—I refer particularly to the criticism made by Deputy Moore—as well as to the criticism, honest criticism, I believe, offered by Deputy Norton. I would like to be satisfied by the Minister on the point I have raised as regards Section 8. Unless he is prepared to accede to the request made to him by Deputy Norton, I want to know is it his intention, where over a particular line it may be found that certain sections of it are not paying, that they are uneconomic, while the other sections of it are economic and paying, to close down the part that is not paying. When I am satisfied on that point I will make up my mind as to how I shall vote.
One is tempted to advert to the rather impertinent opening of Deputy Anthony's observations but in the circumstances prevailing to-day I propose to pass them over. When the Minister was making his speech introducing his Bill, in the course of which he referred to the Railways Bill, I interjected some questions by his implied invitation as to his attitude towards the debenture holders and stockholders of the railway company. The Minister proceeded to deal with these questions very much as a thrush would land on a thorn bush or a cat might walk on the top of a wall. He was very careful to walk round it, and under it, and over it, and beside it; but he was equally careful to be very non-committal. Now, I do not think that he can pass to the Second Reading. Stage of this Bill without stating explicitly to this House whether the Fianna Fáil Government is prepared to stand over in principle the procedure of reducing the value of the debenture holders' property—that is, their security, their right on the assets of the railway company—without their consent. I draw the attention of the Minister to the fact, which he knows just as well as I do, that their position is entirely different from that of the stockholders. It is unnecessary for me to labour that question, and I submit that, before their interest is interfered with, their assent must be obtained. I suggest that that is so because I question the competence of this House to deprive any citizen of his property, by legislation, without his consent. I do not think that the same considerations arise at all where it is a matter of reducing the preference or ordinary shares, because the profits of the railway company will be distributed amongst these other shareholders, and it does not seem to me to affect the situation vitally whether they have £10 or £100 if they are going to get the same dividends no matter what the holding may be. Though it improves the situation from the point of view of the ordinary stockholders, still I think that an entirely different situation is being dealt with from that of the debenture stockholders.
I do not care for the principle of electing directors by postal voting, because I think that, while theoretically it sounds grand, in fact it will result, or could result, in railway directors whose names happen to catch the popular fancy being chosen instead of men being chosen on their merits as good administrators of the property of the company. At present, it works out that the directors are elected by proxies which are largely vested in the hands of the existing directors or in the hands of influential committees which have succeeded in securing the confidence of the majority of the shareholders. This other form of voting, I believe, in practice, would not turn out to the advantage of the railway company.
The Minister spoke briefly and with patriotic eloquence of his resolution to abolish the director which the London, Midland and Scottish Railway Company hitherto had the right to nominate here. It is a very pious purpose and, if it does no harm, I do not think that there will be any great objection to it; but I did not hear the Minister say whether this withdrawal of a privilege which the London, Midland and Scottish Railway Company has enjoyed would result in any loss to the Great Southern Railways Company. He did not say whether this gesture of his will involve the Great Southern Railways Company in any considerable financial liability or not, and, if it does, will he ask himself if this patriotic démarche is worth the price which the Great Southern Railways Company will have to pay for it.
With regard to the powers referred to by Deputy Anthony and Deputy Norton about the discontinuance of train services, I must say that I can see no harm in the Minister's hearing every side of the case before coming to his conclusions, and I do not think that it sounds well for the Minister to tell Deputies not to bring him any information relating to these branch lines, as he desires to reach his conclusions without information. Having made up his mind on one respect, he is resolved to act. I cannot think that the Minister really meant that he would consider nothing but the question of whether a branch line was a paying proposition or not. I cannot imagine that he would maintain for a single moment that the substantial power and property therein should be completely wiped out if, on the operation of the line, it was not proved to be an economic move. I can quite understand his saying that there was going to be no charge on the State funds to make up the deficit and that if people wanted it they must go back to something along the lines of the old baronial guarantee. But I think it is not a responsible thing for the Minister to say that he does not want to hear representations by any particular community or town on a branch line, that he does not want to hear whether the town is deteriorating or possibly advancing—not to bring him that because he did not want to hear it. I do not think that that is a responsible phrase for a Minister to use and I do not think that he meant it.
So far as the larger Traffic Bill—the Road Transport Bill—is concerned, it is a very wide and comprehensive measure and I honestly believe that it is a measure that will have to be really tried and tested. Deputy McGilligan spoke at some length on that part of the Bill which converted newly-licensed road carriers into entrepreneurs, which constituted them common carriers. I think that it would be of assistance to the House if the Minister would outline shortly the liabilities laid upon a common carrier by the common law. They have certain obligations with regard to the safe delivery of goods, but whether these obligations involve them in taking any merchandise offered to them for carriage or not is a matter on which I am not satisfied.
It seems to me from the Bill that a man can get a licence to carry certain stuff and that he can refuse to take certain stuff. It seems to me to be the common carrier liability of a railway company, which has undertaken at certain rates safely to deliver goods save for certain accidents which are set out. I think that the Minister would help us if he would explain what are the obligations on these entrepreneurs as common carriers. Personally, unless the Minister is in a position to throw some very new light on the attitude which the Government proposes to take up towards the debenture holders in this case, I could not vote for the Railways Bill. I do not mean to suggest for a moment that I am not in agreement with the Minister that the debenture holders should be asked to make a contribution towards their reconstruction, and if it were the case that they refused to do this I would rather wind up the company and reconstitute it; but the danger is that, in order to adopt a course which will be expedient and rapid, we may establish a principle which this House would not wish to stand over and, in my opinion, the principle enshrined in this Bill is a most dangerous one and a most undesirable one, and one that might constitute a precedent for doing many things that this House could legally do but which would not be warranted by the circumstances. Rather than do it, I should sooner wind up the company and reconstitute it, if that were necessary.
If the debenture holders—no sane man could suggest that the debenture holders would—chose to put their heels in the ground and refused to lend a hand in this operation of reconstruction, then I would sooner call their bluff, wind up the company, purchase their assets, let them get what they can out of it, reconstitute the company and start afresh. The Minister, with his usual flamboyant eloquence, thumped the counter and said that if the humble porter in Ballybunion was going to lay his tribute on the altar of reform, the debenture holder would be expected to do the same. I happen to number amongst my acquaintances two debenture holders. One is a lady of 74 whose total income is £75 a year. The other is a lady of somewhat similar age whose income is£60. I think if we are to have a trial as between the porter in Ballybunion and debenture holders of this description as to who might be best able to bear the burden of this reform in the railway system, it does seem altogether a wrong perspective for the Minister to raise his voice in thunder for the porter in Ballybunion and ignore the claims of people such as I have described. There may be some debenture holders of this company who are people of considerable wealth, but many others are people who find it very hard to make ends meet, and that should be borne in mind when he proposes to deal with their property. For their own safety and their own good, reconstraction and legislation somewhat on the lines proposed are excellent. But the rights of people who own the property should be considered. We should not allow expediency to drive us into doing something for the purpose of saving our faces which might at some future time have very evil consequences for a large section of the people.
There is one section of the Railways Bill with which I am particularly concerned; that is Section 8. This section authorises the Minister to close down a branch line or to give the company authority to close it down. During the last two years there has hardly been a Deputy in the House who has not been called to a public meeting in some country town or another with reference to the threatened closing down of some branch line. I am rather surprised that this Bill does not contain any provision to prevent the railway company running I.O.C. buses side by side with the railway line. For instance, you have on the route from Cork to Cobh at present 22 buses plying each day. Side by side with them you have 16 trains. The railway line runs side by side with the road on the whole journey. What guarantee have we that the railway company will not come along and close down the railway line from Cork to Cobh, thereby saving themselves the cost of maintaining the railway line and putting on the ratepayers the cost of maintaining the roads for the buses? That is, to my mind, what will happen in the majority of those cases. You have, for instance, on branch lines from Cork to Cobh, Cork to Youghal, Cork to Bandon, Cork to Macroom, Cork to Kinsale, and you might include from Cork to Fermoy and Cork to Mitchelstown, that very dangerous procedure threatened.
The farming community cannot very well do without a railway service. It would be practically impossible for them to do without it. I expected to see in any Bill connected with road transport or with railway transport some definite prohibition of the running of buses side by side with railway lines and I am rather surprised that such a prohibition is not included in this Bill.
I understand that the Minister has power to refuse a licence to a bus company to ply on any particular route. If so, I now suggest to him that he should pick out these routes on which buses are running side by side with the railway lines and immediately prohibit buses plying on these routes. I think it is unfair, to say the least of it, to say that the ratepayers will find themselves in the position of having to maintain a road for the railway company. It is natural, I know it is a thing I would do myself, if there was a road kept by the public and there was another road which I had to keep up myself, that I would use only the road I need not pay for rather than the road for which I would have to pay. The only result I can see from Section 8 of the Bill is that the railway company will undoubtedly close down the routes they have to maintain with resultant unemployment. They will afterwards run buses on routes that are being kept out of the ratepayers' purse.
I should like the Minister to deal with that aspect when he concludes the debate and to say whether he is going to take any definite steps to prevent buses plying side by side with railway lines. I think that is very important in view of the provisions of Section 8. It is all very well for Deputies to attend public meetings and give any amount of soft talk to the people of the town concerned in the closing down of the railway line but we should like to see their promises carried out in practice. I think this is the place to do it. I should like to know what steps the Minister is going to take to prevent I.O.C. buses from plying, say, from Cork to Youghal, Cork to Mitchelstown, Cork to Macroom and Cork to Fermoy. I am sure other Deputies are equally interested in branches in their constituencies and I should like to know what definite steps the Minister is going to take in that particular regard.
Deputy Dillon dealt with the position of debenture holders and he reflected on the Bill from the point of view of interference with their rights. I agree with Deputy Dillon in his remarks in that regard, but I would extend my condemnation of the terms of the Bill to the manner of its interference with the rights of all the stockholders of the railway company. It may be said that it is only a matter of book-keeping to reduce the nominal value of stock on which no dividends have been paid, but the principle behind the Bill is wrong from this point of view, that it is an interference by the Legislature with the capital of the people, who should be consulted beforehand as to what should be done with their capital. The debenture holders, of course, are in a different position in this sense, they are entitled to whatever property is there before other shareholders in the company are paid, but the whole principle of the Bill is wrong in the sense that it is an interference by the Legislature without consultation with the shareholders as to what should be done with the property. It is an interference with the rights of these stockholders. The Minister is very anxious about the position of the porter at Ballybunion. He is fearful lest his wages might be reduced. He has said this side of the House is prepared to interfere with the wages of the porter at Ballybunion and to protect the rights of the shareholders. Might I ask the Minister, before he replies, to look at the railway map and he will see there is no such railway porter at Ballybunion. But the Minister is new to these matters. If he looks at the map he will see that the Lartigue Railway is closed and there is no porter within nine miles of Ballybunion.
One other aspect of the Bill to which I invite the serious attention of the Minister is the section that proposes to repeal the Railways (Directorate) Act of 1924. The Minister, dealing with that section, said that different considerations applied, having regard to the fact that it is now proposed to have seven directors instead of fifteen or sixteen. What are the different considerations that apply? The London, Midland and Scottish Railway had the right, under the Act of 1924, to nominate one director. No doubt he was only one out of fifteen or sixteen. I believe there were considerations under the agreement arrived at, in regard to that section of the Act. I ask the Minister to explain what were the considerations that applied. It appears to me, whether you have eight or sixteen directors, the position of a nominated director representing one particular interest could only be of an advisory and consultative character. He could have no influence upon a vote of the Board of Directors. I would ask the Minister to explain what were the considerations that applied, and why he is asking that that director should be excluded from the board now? I am not in favour of having a representative of an outside company upon any of our boards unless there is proper and adequate consideration for having him there. Are there any proper and adequate considerations for having him there at present? I believe there are. Will the Minister explain what were the considerations in the agreement referred to in the Act of 1924? Is it a fact that the London, Midland and Scottish Company advanced a sum of money to the Dublin and South Eastern Company, and that that money is still due; that there is no interest payable, so long as there is not a dividend of three-and-a-half per cent. for the ordinary shareholders? If they are no longer to have a director would they be entitled to call up that capital sum? Will the Minister explain what arrangements he intends to make if, having excluded their director, the London, Midland and Scottish Company claim payment of the sum due to them? I would like the Minister to deal with that point first and, also, to deal with the point about the porter at Ballybunion.
Like many of the Deputies who have spoken I regret that the commonsense of the Minister, and the circumstances surrounding the railway interests of the country, at the present moment, and for some years past, have not driven him the complete distance along the road which he seems to travel to a fair extent, to see that there is only one solution of the problem and that is nationalisation. I say as an old railwayman, with long experience in the service, and as a matter of sheer conviction, that the muddle and tangle of the transport service in this country will not be solved until it is dealt with on national lines which will enable our inland industries to get the best possible services to enable them to come to maturity. As long as we are working for the sole purpose of private earning it is not possible to build up the industries of this country, and to get their products to the ports in competition with the mass production of cross-Channel firms. That opinion has been intensified in recent years. The Railways Act of 1924 only helped to make confusion worse confounded. As Deputy Norton mentioned there are many thousands of victims who have been thrown out of employment by those who were responsible for that Act. The Great Southern and Western Railways was then a prosperous system working its own lines, but it was compelled by that Act to take over all those little railways in Ireland. The much-discussed Lartigue Railway was the only one that escaped coming under the panel. The Great Southern was pulled down to the level of the animal with a tin can tied to his tail when all these lines were tacked on to it. We have thousands of men who gave loyal services to the Great Southern Railways, now idle because of that muddle. Many arguments were advanced here to-night for the forlorn debenture holders, and we, of the hidebound group of the Labour Party, are not supposed, I expect, in these circumstances, to voice even the grievances of the people who really built up the railways. Even the two isolated cases quoted by Deputy Dillon of the old ladies with £60 debentures which we are asked to believe was their only means of sustenance are not in as bad a position as the mechanics who gave 30 and 40 years' service to the railway company and are existing on the miserable dole of a few shillings a week in Limerick, Cork and other cities and towns in the Free State.
While I regret that this Bill is nothing like as complete or comprehensive as we had reason to expect from the Government, I still reckon it is some step in the right direction. There are many faults in it which I hope the Minister will take the first opportunity of correcting. With Deputy Corry I agree that the worst section in the Bill is Section 8, but bad as Section 8 is, I am more concerned with the indication in the Minister's statement where he seemed to express himself as perfectly willing to sacrifice branch lines without any public inquiry. I would have expected that the Minister would have expressed regret if, even after the fullest inquiry, he had to agree to the closing down of branch lines, if no other course was left open to him. But the Minister in his speech, referring to that section, seemed to intimate perfectly lightly that we could get on without railways if we lose them, and that he would have no qualms of conscience closing down further branches and throwing men on the scrap heap. They should have every possible consideration, and having regard to the railwaymen, the Minister should be mindful of them. Every possible effort should be made to secure that the locality and districts affected will have alternative choice of the best possible service. The Minister should take all necessary steps to see that branch lines are not closed down without having regard to the essential needs for doing so.
The Minister spoke upon the question of unification. He is not going to enforce that in this legislation and he rather hopes that it will be brought about under the ægis of the company. What warrant has he for supposing that this change will be brought about? We in the railway service know that the Great Southern, having purchased the I.O.C., proceeded to subsidise it to the extent of £53,000. They subsequently purchased Wallis's carrying system. They have three sets of directors, for the railway and these two services, not working in co-operation, but working in competition. Some of the incidents arising from their cut-throat competition could scarcely be expected to develop outside a lunatic asylum. These matters had been reported to ex-President Cosgrave when he was at the head of the last Government and they were reported to the Minister for Industry and Commerce in the present Government. They could scarcely believe their ears that such things should prevail; but they are still prevailing and continuing, and yet we are asked to believe that nationalisation could be worse than such a system as that.
The Minister appears to be satisfied that the people, who have never worked these systems in co-operation, will now come together and agree and unify and scrap their redundant boards. I suggest that if we are to have unification it should be embodied in this measure before it leaves this House.
There is, however, one provision which I welcome and that is contained in Section 13. Reference is made there to the London, Midland and Scottish director. If there were no other section in the Bill to commend itself, I would be inclined to vote for the measure merely for the sake of the inclusion of this section. The L.M.S. was formerly the L.N.W.R. They were empowered to lend £100,000 to the D.S.E.R., and in return they got a director amongst the seven directors on the Board of that company. That system was carried on after the amalgamation. The one director remained, but the influence of that individual could be multiplied by at least twenty on the occasion of the transfer of the D.S.E.R. to the amalgamated lines. He was supposed to hold a nominal position, to hold a watching brief on behalf of the L.M.S. What is his position in actual practice? Ask any of the railwaymen, ask the trading community in the country what is the actual position of the L.M.S. director. The fact is that he is the managing director, the chairman of the subsidiary road companies—indeed, the whole shooting-box boiled down to one. His influence has been baneful from the very start and his disappearance would be welcomed by everyone interested in the Irish transport system. What would be the loss to the company? The arrangement was originally made by the L.M.S., not out of love for the Irish railways, but as a good business transaction, and it brought certain benefit to the D.S.E.R. because of the through rates and because of the diversion of traffic. The disappearance of this director will mean no loss to the Great Southern Railways; the company stands to lose nothing if he goes.
There are plenty of people here who seem to be concerned with only one thing, the apparently sacrosanct interests of the debenture holders. They can speak loudly and wisely for themselves. I ask the Minister not to forget in the course of this legislation some measure of protection for the remaining railwaymen. He should not forget that the railway companies are past masters in the art of walking around legislation and driving through Acts of Parliament. They have adopted the practice of taking men from the branch lines and putting them on to the main system. If they consider they are obliged to close down certain sections and work with a minimum staff, there is the possibility that the transferred men will be rendered redundant. That is only one of the little wiles that can be practised by the railway companies. I would like to put information of that sort in the possession of the Minister so that he will be in a position to make every effort to safeguard the interests of the railway workers in such a way that they cannot be outwitted or robbed by the railway companies.
Of course, this must be regarded as continuing railway legislation, as part and parcel of a genuine attempt to grapple with the question. While discussing this question of railway legislation we ought to be mindful of the hundreds of railwaymen who have been denied access to the Railway Arbitration Court. In Limerick City 75 men from one shop were dismissed in one day. Altogether 140 shop men have been dismissed from there, yet not one of their cases has ever been brought to trial, though the applications for the hearing were made as far back as 1931. The rules were complied with, but the Court has not heard any of their cases yet. These men, who were never known to draw charity from anybody, helped to build up Limerick City with their regular wages. They are now drawing whatever can be given them in the way of outdoor relief. I consider nobody has been treated so disgracefully as the dismissed employees. I trust that, even though it will be somewhat belated, sufficient provision will be made in this measure to ensure that those men who have suffered so much will not be forgotten.
It is with reluctance I rise to speak on this Bill. I thought it strange that in the Parliament of an agricultural country, in connection with a Bill that concerns the agricultural population, nobody from the agricultural standpoint, even from the Party that claims directly to represent agricultural interests, has risen to oppose the hardships that this Bill will inflict on the farmers. Deputy MacDermot uttered just a few flippant phrases.
He spoke about the Labour Party.
I will come to the Labour Party in a moment. Deputy Dillon was greatly concerned about the debenture holders. He was not concerned with the agricultural population of Donegal which sent him to this House. He never spoke one word on their behalf. I am in full agreement with the Minister when he says that if present conditions remain for another year and a half the position of the railways will be hopeless. I would like to add that if the present conditions for which he and his Government are responsible remain for another six months, such a measure as this will be of no use to the country.
The whole discussion on this Bill reminds me of the story of a Connaught man who crossed the Shannon at my native place over thirty years ago. A farmer there had a haggard infested with rats. This knight of the road went to the farmer and bargained with him that he would kill all the rats in the place on certain conditions. The conditions were that he would get a good repast with a few shillings thrown in. The farmer consented. "Now," said the wag, "give me a flat stone and a baton." The farmer did not know what he required them for, but he provided them. "Now," said the wag, "get the rats for me and I will kill them." In the same way, when you put this measure through, when you compensate Deputy Davin's men, when you compensate the debenture holders, when you compensate the directors and pension them off, and when you have everything in apple-pie order, you will then find yourselves looking for the traffic with which this new organisation could deal.
I submit that by that time the traffic will have practically disappeared. If you want any proof of that just look at the agricultural trade returns for the last six months and you will find that the exports are down £8,000,000. That means eight millions of a dead loss to the agricultural community— not debentures, not stock, not dead capital, but live working capital plundered out of the pockets of the agricultural community who, despite the mythical 300 factories——
On a point of order, is this Deputy to be allowed to wander over the whole economic field?
This Bill deals with transport.
"Adequate" transport— that has been the adjective qualifying the word used by the Minister and used by Deputy Norton several times. "Adequate" transport is dictated and circumscribed by the economic requirements of the country.
The Deputy would be quite out of order in going into the question of the economic requirements of the country or anything outside of what is contained in the Bill.
I would like, then, some guidance as to what is meant by previous speakers who were not called to order when they spoke of adequate transport. I would like to know what "adequate transport" means? I take it to mean sufficient highways such as will carry the produce of this country to where it is wanted for consumption and bring the requirements that the producers of that produce want at a price that this House is trying to regulate at the present time. I fail to comprehend a situation where you can deal with transport problems if you cannot pass under review the produce of the country going out on those highways and the requirements of the producers that are being brought back on the same highways.
The Deputy is dealing with two Transport Bills. So long as he sticks to the railways and the highways he is quite in order.
It has been stated by the Minister that the present position of the railways calls for this Bill or some regulation of transport. I will deal with the matters in sequence. The depressed condition of the railways is due to the general trade depression. That is not referring to economics but the depressed state of the country is also due to the economic war as well as to the road competition. I fail to see how it is that the Minister can give reasons for the introduction of his Bills and that the ordinary Deputies cannot discuss those reasons. However, sir, I bow to your ruling. I take rather a different view of the treatment of the shareholders from the view taken by Deputy Dillon. Perhaps there may be technical reasons which prompted Deputy Dillon from the legal standpoint. The debenture holders and the preference shareholders, to my mind, are merely holders of wealth. They are taking no chance under the ordinary conditions of the country. When we interfere with their position at all, when we reduce their stock even one point, we interfere with their privileges as debenture holders or preference shareholders. The ordinary shareholder is a man or woman who has risked his or her money— persons with faith in the country and who stake all this money on the economic development of the country. Then if the economic situation, because of reasons that we know, that even the birds of the air know, if these economic conditions press so heavily on the railway company as to depress the market value of their ordinary shares, how does this Government expect the people to risk their money in ordinary commercial enterprises in the future if those ordinary shareholders are now to be wiped out without practically any consideration? Deputy Norton mentioned that since 1924 over 6,000 railway employees have been cast adrift; I think he added without compensation. Deputy Norton and his Party through their policy have cast more than that number of agricultural workers adrift during the last 12 months. If the agricultural workers and the farmer are to wear hair shirts and tightened belts, why should not the railway workers wear them too? Why do you squeal when the railway worker is asked to wear them?
Is the Deputy repudiating the policy of Deputy McGilligan when he was Minister for Industry and Commerce?
How many policies did the Deputy repudiate?
I repudiated the people over there when they repudiated their own policy.
The Deputy was kicked out and it was about time.
The Ceann Comhairle has heard that and he knows it to be a deliberate falsehood.
Is that in order?
I am surprised that any Deputy on the opposite benches would make a statement of that kind considering the twists and turns they have all made.
The Deputy is not in order in accusing a fellow Deputy of making a statement that is a deliberate falsehood. The remark must be withdrawn.
Even if it is true? Must I withdraw the statement that I made though it is true?
The Deputy has been informed that he must withdraw the statement accusing a Deputy of stating a deliberate falsehood.
Well I withdraw the word "deliberate." If the Deputy wants to pursue it further he can.
Can the Deputy say that the statement is false?
It can be "false" without being "deliberately" false.
It is false and nobody knows it better than the Minister.
It has nothing to do with the question of transport.
Did the Deputy twist five times?
Deputy Corry is twisted in mind and in body. I never twisted, nor did my father twist. I quite agree with the Labour Deputies about the question of wages. But let that operate all round. I did more than the Labour Deputies for wages. I do not talk about them. I pay them. I hope the Labour Deputies will stand fast in seeing that if men are thrown on the roadside they will not be left destitute there. If the Labour Deputies adopt a certain policy for one set of workers let them adopt the same policy for the other set of workers. Let the Labour Deputies examine their consciences.
Hear, hear. I agree with that.
Well, then, we will be looking in the same direction before long if you agree with that.
Deputy Belton will join the Labour Party next.
Whatever I will be I will never be a Minister of a fake Republic. The Minister knows that, does he not? Even if this change were desirable, even if the method of the change was a good one, it is hardly the time for a change when we are going through a world depression and when at the same time we are going through an Irish artificial depression. We cannot value the railways until we know what goods may be normally carried on those railways—until we know what the requirements of the country will be. Until then, we cannot value, de-value or write down railway stock. I am talking of normal conditions, economic development, and, I hope, economic construction.
The Minister who sponsors this Bill I regard as the poacher turned gamekeeper. I do not expect that he will start poaching any more. I take it that he has settled down to normal economic life. I think it would be better that we should wait for more settled conditions, that we should wait until we can have a better national stocktaking, before passing a Bill of this kind. Deputy Moore dealt with the situation which may arise as a result of the passing of the Bill. Deputies from the country know that small live stock are now brought to fairs and markets on motor lorries. Deputies from Kerry, Limerick and part of Cork ought to know that the private lorry has raised the price of calves in the Kerry and West Limerick markets and has met a long-felt want in Monaghan and Cavan by affording a south-to-north conveyance for these Limerick and Cork calves. If, under this Bill, these people cannot deal with the conveyance of these calves from Munster to Ulster without taking out a licence as common carriers, the railway company will be able to take them over and they can just wipe out that business. Deputy Moore said that the railway company when they acquire those services would never go round from house to house to collect the merchandise. He rather betrayed his want of knowledge of farming conditions when he said that such things as milk and live stock could await the lorries at the cross roads. I should like to see Deputy Moore trying to load pigs into a lorry at a cross roads.
I saw it done.
It was the by-roads he was complaining of.
At present, they are loaded in the yard. Broadly, I agree with Deputy Moore, that a railway company would not develop that end of the traffic. That would be a serious inconvenience and would bring about a break-up of the present farming arrangements. I have no more to add in criticism of the Bill. It will afford me great pleasure to vote against it.
The concluding remarks of the last speaker must have been rather astounding to Deputy McGilligan inasmuch as Deputy McGilligan assured his successor that he was going to give his vote wholeheartedly for the Second Reading of this measure. I can see Deputy Belton being expelled from the Cumann na nGaedheal Party and another page added to the history of his associations with many parties in this country. Does the Deputy seriously suggest that he is going to vote against the Second Reading of this measure in view of the fact that Deputy McGilligan has already assured the Minister for Industry and Commerce that he is going to vote for it?
He thought the Labour Party wanted it defeated.
I presume that Deputy Belton was not in the House listening to the speech made by Deputy McGilligan from his intimate association with and the study of the whole question. If he was in the House listening to the concluding remarks of Deputy McGilligan, he would not, I am sure, have made the concluding remarks to which we have just now listened. I presume that Deputy Corry's interruptions cut across the mental equilibrium of Deputy Belton.
He is ready for another twist.
Having made a very careful study of the two Bills now under discussion, in consultation with colleagues of mine and others who have a fairly good knowledge of the requirements of the transport industry, I came to the conclusion, before I heard the Minister's speech this evening, that the Minister had no grounds whatsoever for the statements he repeatedly made previously in this House and outside it, that the Fianna Fáil Party was a pro-Railway Party. The measures he promised to introduce were then described by him as "pro-Railway Bills." The Minister was a very wise man to see that these Bills were not published before or during the last general election. I venture to prophesy that, if these Bills had been published, he would not have got the enthusiastic reception which he is reported to have received when he addressed a meeting of railway workers at Inchicore. With your permission, A Chinn Comhairle, I now move the adjournment of the debate.