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Dáil Éireann debate -
Tuesday, 30 May 1933

Vol. 47 No. 16

Financial Resolutions—Report.

Question—"That the Dáil agree with the Committee in Resolution No. 1"— put and agreed to (Minister for Finance).

I move:—"That the Dáil agree with the Committee in Resolution No. 2."

Might I ask if the Minister has been in communication with any boot manufacturers regarding Reference No. 1 (sole and insole leather)? It is proposed to allow these goods in on licence. Could the Minister explain why it is necessary to put in that clause? In the first place the rate of duty on sole leather or insole leather is 37½ per cent., with a preferential rate of duty of 25 per cent., and then power is taken to allow this leather in under licence. Could the Minister give any information to the House as to the granting of these licences; how many have been requested; and if any have been granted?

The licence provision is to permit us to allow sole and insole leather to be imported by boot manufacturers. One of the difficulties in imposing a duty on sole and insole leather, one of the difficulties which was adverted to by the Tariff Commission, when the matter was under examination, was that there was no satisfactory method of distinguishing between leather imported for repair work and leather imported for manufacturers. We have adopted this device of imposing a duty upon all leather with a licence provision, so that we can permit leather to come in free of duty to manufacturers. The present position is that the country's requirements of leather for the repairing business and business other than the manufacturing of boots, would involve a considerable increase in the present output of the tanneries. Therefore, we feel that until we have got to the stage where these tanneries are supplying all the other requirements of the country, there is no necessity to put upon boot manufacturers the direct obligation to get their requirements from Irish tanneries. At a later stage, however, it is intended that boot manufacturers will also be required to take the sole and insole leather tanned here.

I take it then that boot repairers have to pay the tax but the manufacturers have not.

Boot repairers will be required to get the leather from the Irish tanneries.

And the manufacturers will not? That is another way of putting it. Which of the two, would the Minister say, uses the greater portion of the leather?

I think there would not be a lot of difference. I cannot give precise figures on that score. I have satisfied myself that the requirements of the country for repair work are sufficient to occupy fully the existing tanneries. It is likely, of course, that the capacity of those tanneries will be increased and that perhaps new ones will be started, in which case when the trade has been revived and put upon a new basis of efficiency we can withdraw the licences from manufacturers, requiring them also to get their supplies from those tanneries. I do not think we would have any hesitation about compelling boot manufacturers to get their leather from the tanneries here if the tanneries could supply it. It is the fact that they are not able to supply it at the moment that requires this licensing provision.

Could the Minister say whether the leather that is manufactured here or the leather that is imported is the better quality?

The Irish leather is much better.

Then why not give the manufacturers the advantage that is being given to the repairers? Personally I would prefer to wear a new pair of boots for a longer period than to wear a patched pair. I do not know whether the Minister has an alternative discretion with regard to his own footwear.

Boot manufacturers use leather tanned from dry hide. the Saorstát tanneries are not producing that kind of leather at the moment. Of course the leather which they are producing is quite suitable for sole and insole purposes. It is, however, a much better quality than is ordinarily put into boots by manufacturers. No doubt the tanneries will develop the production of leather from dry hide as soon as the existing trade has been restored.

Then we get second class leather in new boots and first class leather in repairs?

Do I understand from the Minister that the only persons given accommodation under the special provision whereby persons may be allowed to import an article liable to duty without limit either as regards time or quantity will be either the persons running the tanneries on the one hand or manufacturers of boots on the other hand?

The manufacturers of boots only. The tanners will not be allowed to import.

Do they get the licences automatically?

Yes. There would have to be certain restriction or examination of their applications, because in one or two cases the boot manufacturer might also be a leather tanner. We would require him to produce evidence that the leather was in fact used in the manufacture of boots. Subject to whatever restrictions are necessary in order to effect that safeguard the licences would be issued automatically.

In regard to No. 11, I should like to know if those licences are given automatically or whether there is discretion with regard to them?

This is the Report Stage of the Resolutions. We cannot treat them as if we were in Committee.

Some latitude is usually given to Deputies when there is a long Schedule like this; it makes for better progress.

I suggest that we deal with them item by item.

If Deputy Cosgrave goes on to No. 11 the Chair should be satisfied that no Deputy wants to raise any matter prior to No. 11, so that we will not have to go back again.

I take it there is nothing on the items between No. 1 and No. 11 that any Deputy desires to discuss?

I wonder could the Minister give us any information as regards No. 4?

That is in fact really changing into a permanent duty what is at present in force as an emergency duty. The metal is metal used for road construction, and in connection with concrete works. The duty came on automatically under the emergency duty upon all steel goods imported. We did not contemplate that it would produce this industry. In fact, two firms started to produce the goods here. The general duty upon steel goods was removed at the beginning of the year, and the persons who were employed in this industry, up to a couple of hundred, were considerably reduced. The duty was then reimposed by another emergency order, and we are now making it a permanent duty. This is one of the industries produced unexpectedly by the emergency duty.

There are several cases in which the Minister, in consultation has taken power to issue licences for the importation of goods without paying any duty. It is a bad principle. It is thought in certain quarters that only certain people would get them. In a case I have heard of, one business man had a licence in a certain town, and another man who was in the same line of business was not aware that it was open to him to apply. I think the Minister ought to tell the House what the procedure is with regard to this, whether the same consideration is given in all cases, and whether there cannot be some sort of intimation given to business people as to how those licences are to be had.

Whenever possible, intimation is given. In cases like the one the Deputy is now discussing the licence provision is merely inserted to deal with the possibility of some special make of tank or cistern being required for special purposes which cannot be foreseen at the moment. Ordinarily, licences will not be issued, but we want to make sure that we will have power to issue licences in certain special cases the circumstances of which cannot be foreseen at present. I think it is undesirable that there should be any extensive use of such a licence provision, and we desire to get rid of those licensing powers as quickly as possible. We hope to get rid of some of them in the coming Finance Bill. The practice is that wherever a licence is given for any type of article the decision upon the application which produced the licence is taken as a test decision, and is applied to similar applications in the future, except the circumstances change in the meantime. Wherever the article can be defined, and is known to fall within a particular category, public notice of the fact that licences for such an article will be given is arranged for. I agree fully that it is very undesirable that there should be any doubt whatever concerning the manner in which those licensing powers are used. The practice is that any facility given to one importer in respect of any class of article is given to all importers until the circumstances have changed, or, to explain the last phrase, until similar articles produced here are available. In certain cases the licence provision is there because of the fact that home production is not quite sufficient to meet the requirements of the country, in which case a licence to import is issued when evidence is supplied that the person or firm in question has made application to the existing firm and has been unable to get his order met. In that eventuality he is permitted to import. Exactly the same procedure is followed in all similar applications. The decision in respect of one governs all similar applications in the future.

Arising out of Reference No. 11, I should like to ask the Minister what particular class of person is going to get an import licence?

In this case the licence will be issued merely for the purpose of importing special types of tanks or cisterns. Certain cases may arise of a particular kind which we cannot foresee, and for a period we require this power. If it is found that the provision is not required, we will get rid of the power next year. We do not contemplate that there will be any widespread use of the power.

A manufacturer of leather will not be given a licence to import, but a manufacturer of cisterns may be given a licence to import?

That is so, for cisterns of a special type.

Are we to understand that the giving of a licence will not be confined to the manufacturers of cisterns?

No, the licence may be issued to any person. The only thing that is contemplated is some unusual type of cistern intended for some particular sort of business or works that would not ordinarily be made here or that might be made in some other country for some specialised production in some industry. Ordinarily, licences will not be issued under Reference No. 11.

Might I suggest to the Minister that the Department should guard against instances of this kind— agreeing to give a licence for a particular article, and changing their mind on discovering further information? That has happened in two or three cases recently, that persons have been promised licences, and afterwards when some further information reached the Department the licence would not be given.

I know of no case in which a promise was made to issue a licence and in which the promise was later revoked, or I know of no case where a licence was given and cancelled because of some new information coming to the Department. I do not know what case the Deputy has in mind, but I think I can guess it. In that case there was no change of mind on the part of the Department, though there may have been a change on the part of the other parties concerned.

I do not say that the licence was cancelled, but I do say emphatically that a promise was given that a licence would be issued in two separate cases. Regarding one of them I have been in communication with the Department to-day. Then on the discovery of further information by the Department they decided not to issue the licence.

I know of no such case.

With regard to Reference No. 14, this question of the manufacture of glass bottles is one that should be settled some time so that we may know where we stand. There is a fixed impression abroad that Ringsend Glass Bottle Factory can supply a wide range of bottles but it is becoming exceedingly difficult to implement the Minister's intention in regard to the package duty, as a result of the glass bottle situation. There is a considerable range of glass bottles which it is not possible to get in this country. One is the glass bottle with the tapering neck. I know of one case where an application was made three weeks ago for a licence to import bottles of that kind. I presume the Revenue Commissioners are trying to satisfy themselves whether or not these bottles are really available in the Saorstát but in the meantime the packer is held up and he cannot pack the commodity at all. I suggest that categorical instructions should be issued to the Revenue Commissioners, that only a certain limited category of bottles can be obtained in the Free State at present and that, at least until the situation has been thoroughly examined, other classes of glass bottles should be admitted without let or hindrance.

The Deputy should make himself acquainted with the history of the glass bottle duty in this country. It is a considerable time since it was first imposed. For a period after its imposition I do not think there was much difficulty in getting supplies within the Saorstát. Then difficulties arose. There was a limited production in the factory which was finally closed down. The duty was, however, maintained, but the licensing provision in connection with the duty was operated so as not to hamper anybody who desired to import glass bottles. Then the glass bottle factory started making dark glass bottles. Licences were issued without delay, I am satisfied, for the importation of any other classes of bottles which were required. The factory is now installing a tank for the manufacture of white glass bottles. When that tank is in full production, the only glass bottles admitted will be of the description set out in the various lettered paragraphs of Reference No. 14. All other types of glass bottles will be produced here. It may be that there will not be the same variety of bottles produced, but there will be bottles produced to meet the requirements of all trades. It is possible that there may be some small class of bottles which may have to be imported of a kind which we cannot visualise at the moment and which is not enumerated in the lettered paragraphs. It is to deal with such cases that the licensing provision is made. That licensing provision will be got rid of as soon as possible because I think in a very short time we shall be able to know whether we have omitted from the list of exemptions any class of bottle that cannot be made here. In all other cases, there will be bottles of all sizes, of white and of dark glass, available, and the only limitation of supply will be in respect of the variety and types of bottles.

May I say that my experience of the Revenue Commissioners is that their promptitude in dealing with these regulations has been admirable? There can be no conceivable reason for complaint in that regard, but there is a certain variety of bottle which cannot possibly be obtained in this country. Take, for instance, the bottle used for bottling cattle castor oil. It has always been a cheap bottle. It is quite inconceivable that for some considerable time at least an Irish glass bottle of that type will be available. I suggest to the Minister for Finance that this business of the glass bottle is cutting right across his packing policy and making it frightfully difficult to carry that policy into effect. The Minister, if he inquires, will find that there are certain classes of glass bottles which it is practically impossible to get in this country and which the Irish glass bottle factory cannot be expected to handle for some time.

I suggest that Deputy Dillon should wait until the Irish factory has tried to produce these bottles. They are not producing the white glass bottles now, but they are having a tank installed for that purpose, and it will be in production in a very short time. Then every class of white glass bottle will be produced— every white glass bottle that there is a mould made to make.

At the present time there is a considerable difficulty in getting permits to import white glass bottles. I can assure the Minister that I have personal knowledge of that because I have applied for them and found it impossible to get them.

Licences for the importation of white glass bottles have been issued since 1926 and 1927 and the procedure in that regard had been fairly regular. There may be just this difference, however, that in recent months in anticipation of some such change, because everybody knew that the new tank was being installed, there have been attempts to bring in abnormal quantities and importers may have been restricted to their ordinary requirements in anticipation of the duty.

I have a circular from the Minister notifying consumers that they will not be allowed to import white glass whiskey bottles. It is absolutely prohibitive. There is no licence given for the importation of white glass whiskey bottles. I would impress upon the Minister that if he does not give the Commissioners instructions to allow in other white glass bottles he is making the position of certain traders in the country extremely difficult. I am not raising this matter with a view to making any trouble. I have myself a licence to import certain white glass bottles and yet I have not been able to get them through.

Some people are under the impression that the best whiskey is put up in dark bottles. The Deputy can get white bottles and contradict that.

I think the Minister's instructions must have been misunderstood. Let him say that no more white glass whiskey bottles will be allowed in, but, that that does not apply to other white glass bottles. The Commissioners have I think misunderstood the Minister's instructions. I want other types of white glass bottles which are now excluded under the regulations.

It is undoubtedly true that the import of white glass bottles is controlled, but that situation will be ended in the course of a few weeks.

With regard to Reference No. 17 there is a duty, I think, owing to the economic war, on metal products from England amounting to 20 per cent. This would increase that duty to 50 per cent.

The position in respect to the existing duty is this: The duty under the Finance Act of last year was 15 and 22½ per cent. It has been increased here and, also, on certain other classes of fencing material. All these goods are produced here by a number of firms who are quite competent to make them.

With regard to the duty on iron gates, I quite agree that iron gates are made in Ireland, but what is the use of increasing that duty to 50 per cent?

I was wrong. This is a new duty. It is additional to the duty on cast iron goods last year.

Gates are not cast iron.

There is no reason why these should be imported. There should not only be an adequate supply, but there should be competition between the firms here which turn them out.

Does the Minister expect that there will be no increase in the cost?

I expect not.

Will the 33? be in addition to the emergency duty?

The emergency duty is not operating now.

What induced the Minister to put a duty on gates? These gates are purchased a good deal by small farmers. Is the Minister satisfied that if he puts a tariff of 33 1/3 per cent. on iron gates as a preferential rate, that that will not increase the price of these articles?

I am satisfied that there will be competition, between existing firms, for the available business. Their productive capacity will be in excess of the country's requirements, so that, apart from other considerations, there will be no increase in price. One or two statesmen in the world are meeting next week to see how they can increase the prices of commodities.

Might I add to that observation of the Minister the hope that these statesmen may succeed in restoring sanity to the lunatic Ministers of Finance who are piling on tariffs all over the world? I trust they will be equally successful in regard to his distinguished colleague, Senator Connolly, who is going to try and get illumination from the few sane individuals left in the world to-day.

I have experience of imported and home-made gates, and I may say that in my judgment the home-made gate is a far superior article and notwithstanding any increase in price should command the market.

It is all very well to toot the horn about home production. I am not reflecting upon the quality of our home-made gates. I said that there were good gates supplied by the Irish manufacturers. The question I asked the Minister was whether the action he is taking may not result in advancing the price of the home-made gates. I did not at all reflect on their quality.

May we look to the Minister to see that if the price of fencing goes up the price of agricultural products goes up also?

May we take it, as a ray of hope, that in regard to these new duties the Minister is giving a preference to the country against which we have been engaged in this economic war?

The preferential rate is enjoyed by more than one country.

Does the Minister tell us that this is not a ray of hope?

There are other rays of hope. I do not think this is one. This is rather a ray of cast iron.

Resolution No. 2 agreed to.