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Dáil Éireann debate -
Wednesday, 2 Aug 1933

Vol. 49 No. 10

In Committee on Finance. - Land Bond Bill, 1933—(Second Stage).

I move the Second Reading of the Land Bond Bill. The purpose of this Bill is to provide for the issue of land bonds to finance all land purchase transactions pending at the date when the British Government guarantee expired. Pending cases are defined in the Bill, as regards tenanted land, as meaning holdings of which particulars have been lodged with the Land Commission before the passing of the Act and sub-tenancies on such holdings, and also holdings held under fee farm grants, etc., in respect of which applications have been received before the passing of the Act. The pending cases of untenanted land are those in which the price has been fixed or agreed on before the passing of the Act. It is, therefore, clear that this Act covers all cases which were pending at the date when the British Government guarantee expired, whether the lands were tenanted or untenanted. It is estimated that about £700,000 of land bonds will be required to finance these pending cases, but in order to allow a margin for safety the figure of £1,000,000 has been inserted in the Bill. The Bill in all other particulars follows closely the lines of the Land Bond Act of 1925, and provides that separate accounts shall be maintained for the new land bonds, and that the provisions as regards sinking fund, redemption, etc., shall be the same. I should like to make it clear to the House that this Bill deals only with pending cases and gives us power only to issue bonds to such value as would be required to finance those pending cases. With regard to the Land Bill now before the House, special proposals will be introduced in due course to provide for the issue of land bonds, and for the general provision of the finances required to operate that Act.

The purpose of the Bill is fairly clear. I do not know whether it is necessary to give any very detailed explanation of it. Section 1 is the usual definition section. I have already pointed out that this covers all the lands tenanted and untenanted in respect of which transactions were pending before the passing of the Act. Section 2 provides for the payment of the purchase moneys in new land bonds in respect of these pending transactions. This follows the lines of Section 2 of the Land Act of 1923, and provides that the purchase money in respect of any tenanted or untenanted land which is pending shall be payable to the vendors in new land bonds, and that all claims against the purchase money shall be payable in like manner. Section 3 provides for the making of advances in new land bonds, and stipulates that these are to be made by means of the issue of 4½ per cent. new land bonds. It further provides for the application of the provision in the Land Purchase Acts to the advances made under the present measure so far as redemption and advances, etc., are concerned. Section 4 follows the lines of Section 1 of the Land Act of 1923, as amended by Section 3 of the Land Bond Act, 1925, and provides for the creation and issue of new land bonds.

As I have already stated, the issue under the present Bill is limited to £1,000,000, while the Land Commission estimate is that only about £700,000 will be required to deal with pending cases. The section also provides for the redemption of the new land bonds by means of periodical drawings. It further provides that all or any new land bonds not previously redeemed may be redeemed at par at any time after the expiration of 30 years from the date of the passing of this Act. The usual provisions are inserted for charging the interest and capital of the new land bonds upon the Central Fund. Section 5 provides for the redemption of new land bonds and follows the lines laid down in Section 3 of the Land Bond Act of 1925. Section 6 provides for the payment by the Land Commission to the Land Bond Fund of interest and sinking fund on the new land bonds, and follows the lines of Section 11 of the Land Act of 1923 and Section 6 of the Land Bond Act of 1925. Section 7 makes provision for setting up a costs fund in connection with the issue of new land bonds. The amount of the costs fund, as previously, is 2 per cent. of the total advances. Section 8 provides that the payment of new land bonds shall be calculated to the nearest pound. Section 9 provides that in the accounts of the Land Bond Fund the transactions financed by the new land bonds shall be kept distinct from those financed by the bonds issued under previous Acts. Section 10 amends sub-section (3) of Section 1 of the Act of 1923, as amended by Section 3 of the Land Bond Act of 1925. These sections provide that land bonds may be redeemed at any time after the expiration of 30 years from the date of the issue of the bonds. The operation of this provision casts an undue burden upon the administration in so far as it would be difficult to keep track of the date of issue of all bonds. The holders and the purchasers of bonds it is felt are entitled to know the date at which the bonds may be paid off. The certificates issued at present are no guide as to the date of issue. In considering this matter it is felt that the simplest procedure is to provide that all old land bonds should be redeemable at par 30 years from the cessation of the British guarantee, that is to say, 30 years from the 18th day of December, 1932, which is the date that is specified in the section. Section 11 is merely a section empowering the Minister for Finance to make regulations for carrying the provisions of the Act into effect, and Section 12 is the short title to the Bill.

This Bill is almost identical with the Land Bond Act of 1925, except that in this Bill there is a single guarantee, whereas in the other Act there was the dual guarantee of this Government and of the British Government. I do not intend to make any comment on that. The machinery in the Land Bond Act of 1925 except for a few minor alterations is embodied almost in entirety in this Bill. The Minister stated that this Bill would require £700,000 to finance the completion of pending cases. I do not understand how the Minister arrived at that figure. The Acting-Minister for Lands and Fisheries when introducing the Land Bill stated that he had schemes ready for the distribution of 100,000 acres. At the conclusion of the Second Reading debate the Minister stated that he proposed in future to distribute land at the rate of 100,000 acres yearly. Surely the Minister for Finance does not mean to suggest now that £700,000 is going to finance the operations of the Land Commission, in so far as untenanted land is concerned, in a period of one year. I understood the Minister to say that the £700,000 would cover the operations of the Land Commission in regard to tenanted land, sub-tenancies, fee farm grants, and lease holds, under Section 44 of the Land Act of 1931, as well as untenanted land and various other classes of land which the Land Commission has to deal with in a normal way.

Am I to infer from the Minister's statement that he proposes at a later stage, probably at the beginning of next year, to introduce another Land Bond Bill, to provide a further sum of money to complete the operations under the Land Act of 1923? Quite obviously, this Bill has no relation to the Land Bill of 1933. The Minister has not given any indication whatever of what is to be the rate of issue of the bonds, what is to be the rate of interest, and what is to be the rate of issue of bonds under the Land Bill of 1933. I think Deputies anticipated that the Minister would give some indication of what the rate of interest would be.

Notice taken that 20 Deputies were not present; House counted and 20 Deputies being present.

The amount which the Minister is asking is apparently only intended to cover a very short period, presumably a few months. Whilst no period is mentioned in the Bill, I anticipate that it is the Minister's intention to introduce another Land Bond Bill, sometime towards the end of this year, because the amount which he proposes to raise by this Bill will scarcely finance land operations for more than a month or so. I invite the Minister to avail of this opportunity to indicate what the rate of issue of the bonds to finance the Land Bill of 1933 is to be. A great deal of insecurity and uneasiness has been caused in the country by some of the very drastic provisions of that Bill, and naturally owners of land anticipated that when he was introducing the Land Bond Bill, the Minister would make some statement regarding the nature of the compensation which is to be paid for the various interests which the Minister for Lands and Fisheries proposes to acquire under the Land Bill of 1933.

It is due to the country and to the Dáil that the Minister should make some statement now with regard to the bonds, the rate of interest, the rate of issue, and the amount of bonds proposed to be issued under the Land Bill of 1933. I assume naturally that operations under that Bill will be postponed for a very long time, in order to complete the operations initiated under the Land Act of 1923, which will occupy at least three or four years. If the Minister is to finance these operations, and if it is his intention to introduce Land Bond Bills periodically, I can easily imagine, and the Minister must realise, that he will have to introduce at least three Land Bond Bills every year for the next three or four years, if land acquisition and land distribution is to be carried on at the rate mentioned by the Acting-Minister for Lands and Fisheries when concluding the Second Reading debate. I assume from the Bill that no proceedings whatever under the Land Bill of 1933 will be undertaken for three or four years.

From the Minister's statement when introducing this Bill to-day, I take it that it is the intention of the Government to complete all the operations started under the Land Act of 1923 and subsequent Acts. If that is so, I do not see any possibility of starting any operations whatever under the Land Bill of 1933 for three or four years. I am rather glad of that. If the Minister can make that position clear to the House, there are many people who will be very pleased with such a statement. This Bill is merely a rehash of the Land Bond Act of 1925, with the exception that we have one guarantee now, instead of a dual guarantee under that Act.

I expected that the Minister for Finance should have dealt with the security he is offering in order to borrow £1,000,000. The Minister certifies for £1,000,000 of paper bonds, pledging the credit of the State to redeem them. That is equivalent to borrowing, as the country will be £1,000,000 the poorer when the bonds are issued. We are going to pay 4½ per cent. for them, and it is not indicated when they will amortize themselves.

Go and read the Act of 1925.

I have read more Acts, and I have forgotten more about bonds and finance, than the Minister for Finance ever learned.

Forget them.

The Minister should have dealt with the economic position, on the strength of which depends his capabilities of borrowing money or incurring a debt. Many people will learn for the first time that the old land bonds were withdrawn from the 18th December last. These bonds are now issued on our own security. The Minister did not tell us that 30 years from 18th December last the Government here can exercise the option of redeeming those bonds. He has not told us in what currency those bonds will be redeemed. I take it the bonds will be negotiable. Will they be redeemable in sterling or in some currency the creation of the Minister for Finance?

We will not talk turf or sugar beet. I think the Minister got frightened of them. We will talk bonds now. The Minister would like us to understand that is more his dish.

Balderdash.

It is not balderdash. So far as I can see the Minister's knowledge of finance extends to the changing of a pound. He has not told us if the economic condition of the country is going to be clarified, so that we will be able to incur periodical borrowings. Stripped of all its padding, this means the borrowing of a million which we must pay at the end of 30 years. In the meantime we undertake the obligation of collecting from certain people interest on the guarantee at the rate of 4½ per cent. and sinking fund at ¼ per cent., making 4¾ per cent. in all. We undertake the obligation of paying whether we collect it or not. We are giving credit to people from whom we take land, where we redeem rents or carry out pending purchases under the 1923 Act. The Minister has not dealt with the country's capacity to incur more debts.

A million is nothing to our distinguished Minister for Finance. A few millions a year would put the people back on the soil doing productive work. It will be interesting to know in what currency he proposes to redeem the bonds. He has undertaken this obligation for 30 years and if the bonds are to be redeemed in sterling it must mean that the famous Republic is postponed for 30 years. We surely cannot be a Republic and use British currency. If it is not sterling, in what will the bonds be redeemed? We should be told. I remember it was a cardinal plank in the policy of the Minister—he was most eloquent on the subject on famous occasions—that we should have our own currency. Now he is afraid to mention it. This is the new brand of Republicanism. Where is there a Republic without its own currency? The Minister will not mention it.

Deputy Belton founded a currency party.

And Deputy O'Briain found a mare's nest. Deputy O'Briain probably does not know that it was put in the forefront of the Party he is a member of to establish our own currency. He is not aware of that. Of course, Deputy O'Briain is true to the traditions of the Party. When the official head of the Party says it is raining, the Party say "Yes"; if he says it is snowing, the Party say "Yes"; and if he says it is Christmas Day, Deputy Donnelly would probably say "Yes, it is." It is a very material thing for those getting the bonds to know in what kind of currency they will be redeemed. I suppose the Minister is aware that foreign insurance companies operating in this country will not grant policies guaranteeing people in sterling; they will pay them only in Free State currency, whatever it is. Does the Minister mean Free State currency or sterling in connection with these bonds? I am afraid we can only conjecture. We will still shout "Up the Republic" while we carry the British sterling unit of currency and accept the gold standard as our standard of value. We will carry British sterling in our pockets, shout "Up the Republic" and fool the people down the country. At £5 a week Deputy Donnelly will organise that foolery.

Deputy Belton evidently tries to convey to the House that the economic conditions are very bad. We have no credit anyway.

On a point of order, I said nothing of the kind. I would be glad to say it, sir, but I am sure you would not allow me.

I would like to point out to Deputy Belton that since this British guarantee of the land bonds was withdrawn the price of land bonds went up. I remember in 1923 that land bonds were 89. They are now 108?. That does not speak too badly for the value of our currency——

Your what? Did you say "currency?"

Yes, whatever currency we may have. The people evidently have faith in it. They have some faith in it. They have more faith in the Irish than the British guarantee. The price of that currency has gone up. The price of our land bonds has gone up. Of course, if I were not a bit of a civil servant, and after turning a mug, and becoming a farmer——

One ought to be proud of being a farmer's son instead of a policeman's son.

I am just as proud of being a policeman's son as you are of being a civil servant.

And you act it here.

Yes, and even though Deputy Belton has alluded to it, I want to say that I stood by the organisation when Deputy Belton was kicked out of it in Belfast jail in 1918.

The currency and the parentage of any Deputy has nothing whatever to do with the Land Bond Bill of 1933.

I do not wish to go back on that sore of Deputy Belton's, but this has become a pretty common remark from the gentleman opposite and it is about time it was altered.

Deal with the matter before you.

The Deputy does not want to go back to the question about Belfast jail.

I will go back as far as I like, but it would not do for Deputy Corry to go back too far.

Deputy Belton was as badly disciplined then as now. This is the point that I wanted to put—the point that despite the withdrawal of the British guarantee the land bonds are fetching more to-day than they were when we had a British guarantee behind them. That is as much as the British guarantee was worth. They have gone from 89 to 108.

I just want to correct the possibility of preventing the country forming any misapprehension as to the probable dates on which proceedings will commence under the Act of 1933. It is not correct to say and one would be wrong to believe that the Land Act of 1933 will not come into operation for three or four years. The purpose of this Bill is to provide the finances which would enable pending transactions under the 1923 Act to be quickly disposed of. As soon as the Land Bill of 1933 becomes law it will be immediately put into effect. It has nothing to do with the Act of 1933 to indicate what the Government's proposals will be with regard to the financing of the Act of 1933. It is enough to say that these proposals will be fair and equitable, both to those from whom the land will be acquired and in respect of those to whom the land will be distributed. I do not propose to follow Deputy Belton into the realms of rameis. He has a licence to talk nonsense about currency in this House, because he has been half of everything in Irish politics.

I never tried to join the British Army like the Minister.

That has nothing to do with the Land Bond Bill.

I want to be clear on two points. First, is it the intention of the Government that the proceedings under the Land Act of 1923 and subsequent Acts are to be cleared up before the 1933 Act is put into operation?

It is to finance all pending transactions.

Point No.2 is, when does the Minister propose to introduce the Land Bond Bill for the purpose of financing the Land Act of 1933?

As soon as possible after the passing of the Land Bill itself. It ought to be obvious to the Deputy that it would be only a waste of time to introduce another item to finance a Bill which has not yet become law. As soon as the Land Bill of 1933 becomes law, a Land Bond Bill will be introduced to finance it.

The Bill might not have the political effect the Minister desires.

Question—"That the Land Bond Bill, 1933, be now read a Second Time"—put and agreed to.
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