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Dáil Éireann debate -
Tuesday, 16 Jun 1936

Vol. 62 No. 16

Public Business. - Insurance Bill, 1935—Recommittal (Resumed).

SECTION 85.
(1) Every contract of reinsurance of assurance business entered into by the company within a period of ten years after the date on which the company commences business shall be guaranteed by the government of Saorstát Eireann, but no right of action shall lie, at the suit of the company or of any assurance company or other person, against the government of Saorstát Eireann under such guarantee or otherwise in respect of any liability on foot of such contract.

Amendment No. 166 is out of order on the grounds that it imposes a charge.

I move amendment No. 167:

In sub-section (1), line 43, to delete all words after the words "Saorstát Eireann" to the end of the section.

When the debate was adjourned on the last occasion, I understand that the Minister for Industry and Commerce indicated his desire to redraft certain sections of the Bill, and on that understanding other amendments to Section 85 were withdrawn. I mention that because it becomes rather difficult to deal with amendments that arise on the remaining sections of the Bill in view of the fact that the structure of this part of the Bill is going to be materially altered. Section 85 sets out the conditions that would obtain after the reinsurance corporation had been set up. As the Bill originally stood, everybody had to offer all their reinsurance to the reinsurance corporation risk by risk.

The Deputy, I think, is speaking to the wrong section.

No. Now we understand that reinsurance is to be effected by an ordinary reinsurance treaty negotiated with the reinsurance corporation. One of the statutory conditions of each such reinsurance treaty shall be, according to Section 85:

Every contract of reinsurance of assurance business entered into by the company within a period of ten years after the date on which the company commences business shall be guaranteed by the government of Saorstát Eireann, but no right of action shall lie, at the suit of the company or of any assurance company or other person, against the government of Saorstát Eireann under such guarantee or otherwise in respect of any liability on foot of such contract.

I have yet to learn what value attaches to a guarantee which cannot be enforced against a guarantor, and I am moving, accordingly, to delete the words set out in the amendment. It seems to me to be a travesty to announce that the Government are prepared to stand behind every contract of insurance and, in the same breath to announce that, while they do so stand behind them, they, by statute, withdraw from the persons depending on the Government guarantee the right to sue the Government, in the event of the Government failing to redeem the actual terms of the guarantee.

It might very well happen that there would be a bona fide dispute between the company which had effected the treaty of reinsurance and the Government as to what the exact terms of the reinsurance treaty were and as to what the exact nature of the liability under the Government's guarantee was. Section 85, as it stands at present, would prevent the company which had made the treaty, and which was depending on the Government's guarantee, going into court to recover from the Government what the company believed they were entitled to under the guarantee set out in Section 85. A more extreme case would be if the Government simply refused to pay altogether. That contingency, I admit, is unlikely to arise, but I do see a very real danger of a genuine difference of opinion arising between the Minister and the company which negotiated the treaty as to the exact liability of the Minister, and I think it is an absurd suggestion that the company should be prohibited from going into court in order to have substantial justice done between themselves and the Government in the matter of this guarantee.

I should like to support the amendment and put before the Minister certain aspects of this case which I do not think Deputy Dillon has drawn to the attention of the House. The State are engaged in trading under this Bill. For certain purposes, they have a reinsurance corporation and, apparently, they are going to stand behind that corporation to a limited extent. I think people who, presumably, are going to entrust their money to insurance companies, and who believe that their money is safe when they pay their premiums, are entitled to know to what extent the Government are not standing behind the reinsurance corporation. I take it that the Government could not be sued except where there was some sort of prima facie case or where a person who felt himself aggrieved at some particular decision, thought he would take the Government into the law courts. Surely if State trading is to be introduced into this country on certain lines in which it has not been introduced before, the State ought to take up the position that they stood in the shoes of the people who formerly carried out that business—that they do not want any better treatment and that they will not have themselves treated any worse. Surely the Government do not want to get the premiums and run none of the risks.

It is probably a far-fetched idea, but supposing, for the sake of argument, there was some claim in which the Government, through the reinsurance corporation, were very largely interested, and the assessors had made a settlement which somebody in the reinsurance corporation thought was not sufficiently in their favour, and the individual, who had his claim guaranteed by the reinsurance corporation, found that, under some particular phase of the transaction, he could bring the Government into court. What are the Government afraid or ashamed of? They are protecting themselves with the money of the country and they would be fighting the action on velvet. Unless the Minister can give us some reasons, which have not been brought out up to this, to show that there are certain aspects in which a person ought not be allowed to sue the Government, I think we would be well advised to give way to this amendment, because nothing will make the public so suspicious as some concealed proviso that the Government are able to do something which, possibly, they may have no intention of doing. The matter ought to be cleared by the Minister saying that, under certain circumstances, the Government are going to shelter behind the fact that they are not to be sued, and then the people would know where they are. I consider this is a most unfair provision, and introduces into the insurance business a circumstance which has not existed up to this, and may very well leave the public, who are insuring their premises, in a state of anxiety which the Minister might very well and very easily allay. I would ask him to make a statement on this section as to the circumstances under which he considers the Government ought not to be sued if there is a prima facie case.

The primary security for those who enter into contracts of reinsurance with the reinsurance corporation will be the resources of the reinsurance corporation, and, in the ordinary course, these resources will be quite adequate to enable it to carry out these contracts. Behind these we put the Government guarantee provided by the section. It is not correct, as Deputy Dockrell stated, that the Government propose to stand behind the reinsurance corporation to a limited extent. The Government propose to stand behind the reinsurance corporation to an unlimited extent for a period of ten years. I think that most people will agree that the Government guarantee provided for here, even with the qualification to which Deputies have adverted, is a valuable security for those who will be engaged in the effecting of reinsurance business with the reinsurance corporation. It is extremely improbable that, under any circumstances, the Government would fail to honour their guarantee of a contract of reinsurance. But if these unlikely circumstances should arise, I doubt very much if the persons concerned would find that a court order would be very effective. In any event, it is wrong in principle to give persons, in these circumstances, the right of action against the Government.

The Government are guaranteeing the contracts of the reinsurance corporation, and if that guarantee has to be made good at any time, the Government will be obliged to come to the Dáil and ask the Dáil to vote the necessary money. It will depend upon the concern which the Government in office have for the credit of the State and the general conduct of business here to see that that is done. I think there is no prospect of circumstances arising by which it would not be done. But it is considered undesirable in principle to give parties the right of action against the Government, and, as I have said, that right would be an illusory safeguard in the very improbable circumstances in which the Government would fail to honour the guarantee.

I do not think the Minister has quite cleared our minds as to the circumstances that might arise. I take it that there is mention somewhere in this Bill of a reinsurance corporation with a capital of £500,000. That £500,000 would be very adequate for meeting certain risks, but there are certain obscure risks involved in insurance, such as earthquakes and fire, arising possibly from riot and civil commotion, or some such hazard as that. In those circumstances, £500,000 might go a very short distance.

In the course of time, the resources of the company will be considerably in excess of that.

I hope so, but there is an intervening period, and if the Minister could give the investing public a guarantee that there would be no earthquakes here for the next 25 years, it would remove that hazard, but there are other factors to be considered. To my mind, the kernel of the whole matter is the feature of compulsion. The people are compelled to reinsure with this reinsurance corporation. In the ordinary open market, they can get companies with gigantic resources. Apparently the Minister wants to stand behind this reinsurance company to a limited extent. This is the acid test so far as we are concerned. Can the assets of the Government be brought in when there is some huge and unforeseen hazard? In the case of money invested in insurance by the public at present, the insurance companies are backed by each other, and by other outside companies, and the risk is so spread that there is practically no chance of a default on the risk. Now we are invited to do away with the chance of investing with those insurance companies. I grant you that unusual events are not very likely to happen, but they occasionally do, and this country may be faced with a defaulting reinsurance company behind which the people thought the Government was standing, but which they find they are standing behind only to the extent of their guarantee. That would be quite all right if the reinsurance corporation stood on all fours with every other company, and if it was a case of "Let the buyer beware" as to whom he puts his money with, but where compulsion is introduced, the security ought to be beyond question.

I think Deputy Dockrell is labouring under one misapprehension. He contemplates the reinsurance company retaining all the risks ceded to it by the insurance companies. To the extent that the board of the reinsurance company considers it wise to do so, having regard to its own resources, it will arrange to retrocede those risks to other insurance companies or reinsurance companies, and, as I explained before, carry on its business in an ordinary commercial way. It will be the function of the board of the company to see that at no one time is it carrying greater risks than its resources would justify. It is not intended that the reinsurance company should carry all the risks ceded to it. In so far as it is necessary to do so, they will arrange for the retrocession of these risks elsewhere.

Admitting all the facilities afforded by treaties of retrocession, and, mind you, I see no provision in this Bill which would permit a reinsurance company to make treaties of retrocession with other than Saorstát Eireann companies——

There is no limitation on them at all.

They can make treaties of retrocession abroad?

Let us suppose they can. That does not vitiate in the very least the point made by Deputy Dockrell, that where you compel them to transfer a certain part of their business to a given firm, you are not entitled to shake from your own shoulders, responsibility for that firm's solvency. The Minister admits that by the introduction of Section 85. He sees that it is unreasonable to order people to deal with a firm which is only just set up without giving them some assurance that that firm has something more than the capital and combined experience of its board of directors, but he suggests in the terms of Section 85 that, after 10 years, there would be plenty of security there to provide for everybody. If the Minister's attitude was that at the end of 10 years, you are perfectly free to insure with whom you like, nobody could press him on the subject of guarantee, but what the Minister says is "For all time you must give this company, not so much of your reinsurance as you want to give them, but so much of your reinsurance as they want to take." How on earth can he maintain that there is no obligation on the State to add "If this reinsurance company with which we are forcing you to deal, very possibly against your will and your better judgment, fails, the Government will step in and meet whatever balance of your claim the corporation is unable to carry on whatever balance they have not already retroceded elsewhere"? That is one point.

The second point is that the Minister has said it is contrary to principle to give anybody a right of action against the Government. Since when did it become contrary to principle to give anyone a right of action against the Government? If the Minister's motor car, in which he drives every day, and which is a charge on his Estimate, knocks me down, I can sue the Minister for Finance, I think, for damages, and recover from him. I can sue any Department of State under the Workmen's Compensation Act, and recover damages. The action of guarantee is closely analogous in this case to an action for damages. If the Minister involves an insurance company in heavy losses, as a result of imposing a statutory obligation on it to deal with the reinsurance corporation, he says in the statute that he will pay any damages that may result from the compulsion he puts on them. Why cannot we sue for those damages in court in the same way as we sue the Minister for Finance for damages under the Workmen's Compensation Act and analogous circumstances? There is no principle at stake. The only principle that was ever invoked to preclude persons from suing the Government is the principle that the citizen may not sue the King, and that is a wholly archaic principle which is steadily being swept away by statute in Great Britain and everywhere else. It is absurd to reinvoke it in connection with Section 85, and if there is any other principle on which a refusal to permit a citizen to sue the Government rests, I should be glad to hear of it, because I have never heard any other principle cited in defence of that proposition, except that the citizen should not sue the King and should have no right against the King except by a petition of right.

In my opinion, Section 85 becomes perfectly useless unless you delete the remaining words. It is all very well for the Minister to say that any Government solicitous for the credit of the country would come in here and introduce an estimate to meet any claim that should arise, but I put the case again: Suppose there is a bona fide difference between the Minister, or the Government of the day, and an assurance company as to what the Government's liability is under the guarantee set out in Section 85, who is going to decide it, and who is going to force the Minister to give something more than the Minister thinks he is obliged to give by the terms of Section 85? Unless we have the right to sue the Minister and bring him into court, he becomes the guarantor and the arbitrator in his own business, and I suggest that that is a perfectly absurd position. If there is a guarantee, I suggest that that guarantee should be enforceable by law—most especially because there is compulsion on the company as between it and the reinsurance corporation and because, at any moment, a case may arise in which it would be impossible to arrive at agreement between the company and the reinsurance corporation without resort to the courts.

With reference to what Deputy Dillon has said, any question that might arise as to the rights of an insurance company, as between it and the reinsurance corporation, can be determined by the court. I think that the only case of the type that Deputy Dillon has in mind could be determined by a court in the ordinary way.

I should like to point out that in the section, as drafted, looked at merely from a technical point of view, there is no guarantee whatever. Not merely is there no right of action, but in reality there is no guarantee at all. In actual fact, there is no such thing as Saorstát Eireann. Nobody ever heard of such a thing as a Government of Saorstát Eireann except in reference to political matters. One speaks of the Government of Saorstát Eireann as a body of men responsible to the Dáil, but in effect, and legally, there is no such thing as Saorstát Eireann. Nobody ever heard of the Government of Saorstát Eireann being sued as a legal entity. There is no such legal entity as the Government of Saorstát Eireann. It is not mentioned in the Constitution. When one speaks of the Government of Saorstát Eireann, that is merely a popular term for the Executive Council, and that is merely a body which is politically responsible to the Dáil. Therefore, looking at this thing from a purely technical point of view, to say that the Government guarantees it means nothing. If it means that a group of people who, for the moment, are politically responsible to the Dáil, are to guarantee this thing, then it is the most perfect nonsense that one can conceive. I do not say that it is deliberately done, but I suggest that it may be deliberately done in order to be able to say that, in fact, and in effect, there is no such thing as a guarantee at all if a dispute should arise.

The Minister has said, in effect, that a matter of this kind can be left to the court, but, of course, that means that it is left to the Minister for Finance. In other words, it is left in the hands of the officials, and Deputy Dillon put his finger on the real essence of the matter when he said, firstly, that if there is any foundation in what the Minister said about giving this right to the company, it is merely a harking back to what was done in earlier sections of this Bill—to the prerogative of the Crown—that the King can do no wrong—and, secondly, that there was a greater tendency to get away from such prerogatives and to give to ordinary citizens rights of action against Departments of State. As he pointed out, even in England they are doing that. They are getting away from such prerogatives in England. As a matter of fact, a committee was set up there recently, I think, to decide what machinery should be set up to allow actions by individuals to be taken against the State. That has been the case even in England. In this country, as a matter of fact, we have nullified to a large extent the ban on taking action against the State by the passing of the Ministers and Secretaries Act, subject to the fiat of the Attorney-General, and, under the Ministers and Secretaries Act, the Attorney-General is an officer who is independent of the Executive Council. The Attorney-General does not hold his office under the will of the Executive Council. I am not going to enter into the merits of that, but I think that provision was inserted in that Act for the purpose of seeing that the Attorney-General, whoever he might be, would perform his duties impartially, irrespective of whatever Government or Executive Council might be in power, and irrespective of political considerations generally.

I suggest that the position the Attorney-General holds, under the Ministers and Secretaries Act, is to give his fiat to the institution of actions against the Government or Government Departments and that he is not there to prevent actions, as such, but to prevent vexatious or frivolous actions against Government Departments. It is open to the Attorney-General to prevent what he may think vexatious actions and, undoubtedly, he can use that power capriciously. However, I do not want to express an opinion on that. The point is that there is a responsible officer, independent of the Executive Council who can give his fiat irrespective of the views of any Government Department and irrespective of political considerations. That is the principle which operates in this country. The under-lying principle of requiring the fiat of the Attorney-General before proceedings are taken against the Government is to prevent vexatious or frivolous actions. I think that that will be admitted. Why not, then, do the same in this case, and at least keep the principle in conformity with the principle underlying the Ministers and Secretaries Act, or, as Deputy Dillon has pointed out, with the principle underlying the Road Traffic Act or the Workmen's Compensation Act? As Deputy Dillon has pointed out, you can do this under these Acts, and he has also pointed to the really bad principle here: and that is as to who is to adjudicate in a dispute between the Government and some person who is dissatisfied on this matter of reinsurance. As Deputy Dillon has pointed out, the Departmental officials will decide it, as things stand at present, and they will decide it according to their own views, and we all know that the Departmental officials are always right. As a matter of fact, some of us have had considerable experience of the way Departmental officials work in connection with the various Damage to Property Acts. We have had cases, known as “Report Cases” where all the formalities were gone through and where the judges concerned were asked to waste their time debating these things—and I, personally, have had some considerable experience, during a period of three or four years, in dealing with such cases—and where, after the judges' award these reports came in sheaves from the various High Court judges and were then gone through with a high-powered microscope in the Department of Finance. As a matter of fact, I was amazed by the ingenuity of the Department of Finance in finding out what was left undone by the State Solicitor or by the judge, and, not merely what was left undone by the State Solicitor or the judge concerned, but what was left undone, even on appeal, by the Chief State Solicitor or the judge of the Appeal Court. In other words, the officials of the Department of Finance arrogated to themselves the absolute right to say whether or not the decision of a judge was right or wrong, and, even where the judge made the decision that a claim should be paid, the officials refused to pay.

What will happen here—if anything will happen except a mere refusal to pay? The Ministry of Finance will be the body that will have the power to decide whether to pay or not pay. I suggest to the Minister that he should leave this out. Either let there be no guarantee at all or let there be a proper guarantee. As Deputy Dillon has suggested, the insurance corporation should be left to stand on its own legs and not to be bolstered up by a completely illusory guarantee such as is suggested here.

Has the Minister nothing to say to this that a person who is supposed to be given a guarantee under this section does not exist in the eyes of the law.

There is no answer to that. That is why he does not want to say anything.

That does not bother the Minister. Does he maintain the principle that no right is founded in that person?

The principle of commonsense.

Of expedience.

If there was a Government which said that they would guarantee a contract, but subsequently failed to do so when a claim was made under the guarantee such Government would not likely be intimidated by a court order.

If there is a Government which says that they guaranteed a contract, and if the contract failed, the Government owes £67,000 on foot of it. If the Government says that they do not owe that, but owe £32,500, which they stand ready to pay, the ordinary procedure would be to go to the High Court for £67,000, knowing that £32,500 would be lodged in court. That is my remedy if I believed the Minister had undertaken to guarantee me.

The Minister does not undertake to guarantee anyone except the reinsurance company.

And if the reinsurance company goes smash, I turn to the Government.

No. You have no right to turn to the Government.

Have I not the right to the Government guarantee?

The Government guaranteed the reinsurance company.

The section says:

Every contract of reinsurance of assurance business entered into by the company within a period of ten years after the date on which the company commences business shall be guaranteed by the Government of Saorstát Eireann...

My first remedy is against the reinsurance company, and if that should fail my remedy is against the guarantor. The reinsurance company may redeem its treaty of insurance up to a certain sum and then go burst. The Minister takes the view that he remains liable for £32,500. I submit that the Government is liable for £67,000. There was never a litigant who did not take up the position that the other party to the litigation was wholly unreasonable; that there was no question about the liability, and what the other party was to pay. That is always the way. The fact remains that there is litigation and that the parties cannot agree.

What parties?

The guarantors.

The two parties to the contract.

Nonsense. It is a contract——

Of guarantee. That makes the Minister liable for every penny of the sum reinsured, less whatever the insurance corporation finds. If it fails, then the Government is responsible for every penny. If the reinsurance company finds a part, the Government is responsible for the balance. Circumstances may arise in which there will be legitimate differences of opinion. At this moment, if I were the insurance company, and the Minister was the Minister for Industry and Commerce, as he happens to be, and that this Bill was in operation, there would be a difference of opinion between him and me as to what our respective rights were under this section. The very fact that he cannot agree about it across the floor of the House is evidence——

That the Deputy is wrong.

That explains the whole situation better than an hour's debate. The Minister's answer is that the Deputy is wrong. I ask the House to give me the right to go to the High Court and to submit my case to a judge. The Minister's contention is that I am wrong. If I make representations, and if there is a clash, does the House wish to enshrine that principle in this Bill? If that is so, it means that justice has vanished from the country. I could talk for an hour, and I could get no more dramatic illustration of the position than the Minister's statement, and I have no hesitation in asking the House not to be led by what the Minister interpolated, but to strike out the words set out in my amendment, and to allow me the right to go to the High Court in the event of a legitimate difference arising between myself and the Minister.

It is quite clear from the remark the Minister interpolated that he does not understand the first thing about the section. In answer to Deputy Dillon the Minister on a couple of occasions stated that the contract of guarantee was between the Government and the reinsurance company.

The guarantee is provided by the section.

Assuming that it be so, it is a guarantee whether provided by the section or not, and a guarantee, as the Minister must know is a contract and the person who is guaranteed can sue the guarantor, leaving out the principal debtor, without resorting to him at all. Perhaps it is news to the Minister that if he guarantees a friend in the bank for £50 the bank can go against him for the £50 without bothering about the principal debtor. The section contemplates that there might be a right of action against the insurance company. It is clear there is not to be a right of action against the Government. The company that reinsured the other insurance company could sue the guarantor.

If the Government failed to pay?

If the reinsurance company failed to pay. There would be no half measures about that. They could go straight against them without waiting for the Minister for Finance to make up his mind whether he would pay or not.

The only question arising is whether payment was made or not.

Not at all. Whether the reinsurance company may default or not. The section prevents any other person but the insurance company taking action. I drew attention to this on the Second Reading and a change was made, and as a result, reinsurance is itself insurance and nothing else. What you are guaranteeing, if you are guaranteeing anything, is the moneys due to the policy-holder. It is the policy-holder who is interested in this guarantee of the original insurance company, and I say that he should have an action against the Minister for Finance.

Is it the Deputy's contention that if I insure a house for £1,000 and if an insurance company fails to pay I can go to the reinsurance company?

I believe you could. It is merely assigning portion of the contract. If you look up a Dutch case that was decided in 1925 it will bear out that contention.

Is it the Deputy's contention that a policy-holder has a right of action against a reinsurance company?

Undoubtedly. Will the Minister look up the Dutch case? It was in the 1925 appeal cases. He will find something there that will enlighten him. We are not now discussing a question of law in court. We are discussing the section, and if there is anything in the section, or any substance in the Minister's contention, that the whole object of the Bill is the protection of the policy-holder, then he ought to be given this real guarantee, and to give effect to it by allowing a right of action in court, if necessary, at the instance of the policy-holder. It is the policy-holder is interested. He is the person to be paid.

By the insurance company?

By the insurance company or anyone else he can get it from.

By the insurance company only.

A policy-holder is interested in the fact that under the Bill the company with which he is forced to insure, or the small group of companies is selected from within a small range. He is not allowed to insure with any company that has not a licence here. He is forced to do that in the first instance; he is forced to do that knowing that the company with whom he insures must itself pass off some of that risk, not to the various big reinsurance companies to whom it could have passed it before, but to this company that is coming up here for the first time, and about which the Minister has expressed in this House during the course of this debate the greatest possible fears and anxieties. The policy-holder that this Bill is supposed to be brought in to protect is not to have any right at all. Surely he is interested in the question of where his reinsurance is going? Before the passing of this Bill, if he insures with a certain company he knows that back of that company and on his risk there is a large number of very big backs which are able to bear it. He has to look not merely to the company with whom he insures originally but he knows that he has the security of all the companies that are at the back of it, and which he can effectively get at if the need be. The Minister may not have adverted to those considerations. It is quite obvious that he has not really given this matter consideration at all, and that behind the bringing in of this section to the Bill is the same mentality and the same idea which brought an earlier section into the Bill providing that State debts should be paid before anybody else got paid.

The only case that will arise is where the reinsurance company has an admitted claim but no resources to meet it, in which case it will come to the Government to make good its guarantee.

Surely it is the belief of the Minister that if you ensure a risk with an insurance company, and that insurance company itself is in a position to recover, through reinsurance, the amount insured, that must confer some kind of right on the original insuring party?

None whatever. The insuring party's contract is with the insurance company only.

Even if that company has reinsured the entire risk with a perfectly solvent body——

——which, on the development of the risk, pays every penny of the reinsurance to the insurance company?

I must say the Minister's suggestion seems to me to be absurd. Whether the Minister is right or wrong, and I believe him to be wrong, it does seems to me to be absolutely indefensible if you constrain an individual citizen of this State to insure with insurance companies who are forced to give a share of the reinsurance to a certain company, that no right of action should be given him to recover the loss. I again challenge the Minister to say on what principle he founds that doctrine, or does he abandon the ground of principle and move over on to the ground of expediency?

Both are equally strong.

What is the principle? Would the Minister tell me what is the principle on which he denies a person the right to sue the Government? I know of none. Can the Minister tell me?

I do not propose to deal any further with it.

Obviously the Minister cannot do so. There is no reason.

Question put: "That the words proposed to be deleted stand."
The Committee divided: Tá, 52; Níl, 16.

  • Aiken, Frank.
  • Bartley, Gerald.
  • Beegan, Patrick.
  • Briscoe, Robert.
  • Concannon, Helena.
  • Cooney, Eamonn.
  • Daly, Denis.
  • Derrig, Thomas.
  • De Valera, Eamon.
  • Doherty, Hugh.
  • Everett, James.
  • Flynn, John.
  • Flynn, Stephen.
  • Fogarty, Andrew.
  • Goulding, John.
  • Harris, Thomas.
  • Hayes, Seán.
  • Hogan, Patrick (Clare).
  • Keely, Séamus P.
  • Kelly, James Patrick.
  • Kelly, Thomas.
  • Keyes, Michael.
  • Killilea, Mark.
  • Kilroy, Michael.
  • Kissane, Eamonn.
  • Lemass, Seán F.
  • Boland, Gerald.
  • Brady, Brian.
  • Breathnach, Cormac.
  • Little, Patrick John.
  • Lynch, James B.
  • MacEntee, Seán.
  • Maguire, Ben.
  • Maguire, Conor Alexander.
  • Moore, Séamus.
  • Murphy, Patrick Stephen.
  • O'Briain, Donnehadh.
  • O'Grady, Seán.
  • O Ceallaigh, Seán T.
  • O'Doherty, Joseph.
  • O'Reilly, Matthew.
  • Pattison, James P.
  • Pearse, Margaret Mary.
  • Rice, Edward.
  • Ryan, James.
  • Ryan, Robert.
  • Sheridan, Michael.
  • Smith, Patrick.
  • Traynor, Oscar.
  • Victory, James.
  • Walsh, Richard.
  • Ward, Francis C.

Níl

  • Bennett, George Cecil.
  • Bourke, Séamus.
  • Burke, James Michael.
  • Cosgrave, William T.
  • Costello, John Aloysius.
  • Dillon, James M.
  • Dockrell, Henry Morgan.
  • Doyle, Peadar S.
  • Keating, John.
  • Lynch, Finian.
  • McMenamin, Daniel.
  • Morrisroe, James.
  • Morrissey, Daniel.
  • Mulcahy, Richard.
  • Redmond, Bridget Mary.
  • Rowlette, Robert James.
Tellers:— Tá: Deputies Little and Smith; Níl: Deputies Doyle and Bennett.
Question declared carried.
Amendments Nos. 168 and 169 not moved.
Question proposed: "That Section 85 stand part of the Bill."

Section 85 proposes to operate only for ten years, but the obligation to reinsure which it imposes continues for ever. All the arguments to justify a claim for a right of action against the Government apply after the extension of this period of ten years indefinitely, so long as the Government indefinitely requires persons in insurance here to reinsure with the company. I would be glad to know how the Minister hopes to justify the termination of the Government guarantee after ten years. I would be also glad to know if he would indicate to us his intention of maintaining the section in conformity with the suggestion made by Deputy Costello that the Government of Saorstát Eireann, in the eyes of the law, does not exist. He will probably remember that a case was brought in the courts, in this country, in which an attempt was made to sue the Government of Saorstát Eireann. The claim in that case failed on the ground that no such person existed.

So far as the ten years' provision is concerned, it was inserted in order to ensure that if after that period the Government desires to continue the guarantee further, new legislation would be required, and the Dáil would have to be consulted. If, as is probable at the end of ten years, the provisions of the section would be continued in its present or some modified form, we think that, having regard to the provisions of the section, fresh legislation should be introduced. I do not propose to discuss the question whether there is or not such a person as the Government of Saorstát Eireann. I leave that to the Constitution.

The Minister may, if he pleases, be facetious, but I think he should consult the draftsman in order to consider whether the words are effective or not, or whether they operate effectively in regard to the persons guaranteed. If the Minister will amend the section, no difficulty will arise, but it would be a grave matter if the Minister informed the House that the words were put there by design.

I think sub-section (2) answers that.

The Minister may think that sub-section (2) answers the question which I put to him, but that is a matter upon which I am not going to give a conclusive opinion. I do not think that the Minister would be wise in attempting to do so either. It is clear that on a question of reference to the Government of Saorstát Eireann the courts have decided there is no such person. Such a reference is, therefore, undesirable and dangerous, and should be eliminated, and words in accordance with that decision should be substituted. So far as the Minister's intention of reviewing the section at the end of ten years, no difficulty would arise if the Minister also provided that Part VI of the Bill should only obtain for ten years in so far as it operates to compel the insurance company to reinsure with the corporation. If he is going to reconsider Section 85 at the end of ten years, he should also give notice that he will reconsider the section in Part VI of the Bill which compels the insurance companies to reinsure with the insurance corporation. The whole substance of our case is that it is unfair to impose such obligations without giving effective guarantees of the ultimate point of view of the State.

Legislation to repeal Part VI could be introduced by any Government.

We are not responsible for what any Government might do. We are responsible here for what this House may do. We have passed Section 84, and we are passing Section 85 in a form which intimates that every contract of reinsurance shall be guaranteed only for ten years. That is wholly unjust and unreasonable. We could suggest that we ought to pass the Bill without Section 85 at all. No one would suggest we should compel insurance companies to reinsure with the corporation without any guarantee. But after ten years no one will know what the effect of the Bill will be without Section 85.

Question put.
The Committee divided: Tá, 52; Níl, 16.

  • Aiken, Frank.
  • Bartley, Gerald.
  • Beegan, Patrick.
  • Boland, Gerald.
  • Brady, Brian.
  • Breathnach, Cormac.
  • Briscoe, Robert.
  • Concannon, Helena.
  • Cooney, Eamonn.
  • Crowley, Timothy.
  • Daly, Denis.
  • Derrig, Thomas.
  • De Valera, Eamon.
  • Doherty, Hugh.
  • Everett, James.
  • Flynn, John.
  • Flynn, Stephen.
  • Fogarty, Andrew.
  • Goulding, John.
  • Harris, Thomas.
  • Hayes, Seán.
  • Hogan, Patrick (Clare).
  • Kelly, James Patrick.
  • Kelly, Thomas.
  • Keyes, Michael.
  • Killilea, Mark.
  • Kilroy, Michael.
  • Kissane, Eamonn.
  • Lemass, Seán F.
  • Little, Patrick John.
  • Lynch, James B.
  • MacEntee, Seán.
  • Maguire, Ben.
  • Maguire, Conor Alexander.
  • Moore, Séamus.
  • Murphy, Patrick Stephen.
  • O'Briain, Donnchadh.
  • O Ceallaigh, Seán T.
  • O'Doherty, Joseph.
  • O'Grady, Seán.
  • O'Reilly, Matthew.
  • Pattison, James P.
  • Pearse, Margaret Mary.
  • Rice, Edward.
  • Ryan, James.
  • Ryan, Robert.
  • Sheridan, Michael.
  • Smith, Patrick.
  • Traynor, Oscar.
  • Victory, James.
  • Walsh, Richard.
  • Ward, Francis C.

Níl

  • Bennett, George Cecil.
  • Bourke, Séamus.
  • Brennan, Michael.
  • Burke, James Michael.
  • Cosgrave, William T.
  • Costello, John Aloysius.
  • Dillon, James M.
  • Dockrell, Henry Morgan.
  • Doyle, Peadar S.
  • Keating, John.
  • Lynch, Finian.
  • McMenamin, Daniel.
  • Morrisroe, James.
  • Morrissey, Daniel.
  • Mulcahy, Richard.
  • Redmond, Bridget Mary.
Tellers: Tá, Deputies Little and Smith; Níl, Deputies Doyle and Bennett.
Question declared carried.
SECTION 86.

I move amendment No. 168:

Before Section 86 and in Part VII to insert a new section as follows:—

So far as may be prescribed all printing for or in connection with assurance business licensed under this Act shall be done in Saorstát Eireann and all paper and other material used for the purpose of such business shall be of Saorstát Eireann manufacture.

Amendments somewhat similar to this have been inserted in other Acts of the Oireachtas. The amendment, I think, explains itself. I am sure the Minister will appreciate the idea of having as much work as possible of this kind done in the country. A considerable amount of insurance literature is issued and it would be in the interests of the trade to have it printed here, if possible.

I have complete sympathy with the object of Deputy Doyle's amendment but a provision of this kind would be inappropriate in this Bill. There is a Customs duty on matter of this kind at present. If it is contended that that duty is insufficient in relation to this class of printing, or to these classes of documents, it can be reconsidered or action could be taken under the Control of Imports Act but I do not think we could insert a provision of this kind in an assurance measure. It would be more appropriate in a Finance Bill or a Control of Imports Bill.

I know there are many difficulties in the way of giving effect to the amendment. Since tabling the amendment, I have been somewhat enlightened as to the difficulties that would arise. Nevertheless, I should like if the Minister could see his way to meet the amendment in any possible fashion.

We have a 50 per cent. ad valorem duty on this matter at present.

That would be interesting only to the Minister for Finance but the policy-holders would like to see some of their money going back to the people in the way of providing work.

I realise that it would be contrary to parliamentary procedure for the Deputy to put down a motion to increase the duty but the matter could be raised in another way and I should be prepared to consider it at any time.

Amendment, by leave, withdrawn.
Amendment No. 169 not moved.

Is this another of the Labour amendments that are not being moved?

The Chair is interested, not in the names appended to any amendment but in the fact that the amendment is not being moved.

Question proposed: "That Section 86 stand part of the Bill."

What is the significance of the extension of bond investment business? This is the first of the miscellaneous sections.

What is the deputy's difficulty? What constitutes bond investment business is defined in the definition section. A person who carries on business of the class described in this section is deemed to be doing a bond investment business.

I do not know what the meaning of Section 86 is. Has the Minister no further information to give us than to refer us to sub-section (1) of the definition section?

In that section, there is a definition of what constitutes bond investment business.

What does this section provide in that connection?

That a person accepting subscriptions payable at periodical intervals of less than six months and undertaking to pay to subscribers the amount of such subscriptions with interest shall be deemed to be doing a bond investment business.

What does this section do to persons carrying on a bond investment business?

It makes them subject to the legislation.

Is that all?

Yes, subject to the provisions of sub-section (2).

After that, is any of us any wiser? My respectful submission is that the Minister does not know what the section means.

The Deputy has confessed that he does not know.

I want the Minister to tell me. I assert that none of the Deputies opposite—Deputy Concannon, Deputy Moore, or Deputy Kelly— knows the meaning of the amendment. I go further and I say that the Minister does not know the meaning of it.

It is quite an intelligible section and any person with average intellignce who reads it will understand it.

The Minister always says that when he does not know himself what a section means.

Question put and agreed to.
SECTION 87.

I should like to ask Deputy Costello to leave over amendment No. 170 until the next day. I think it will be necessary to re-draft this section and, in re-drafting it, we may possibly meet Deputy Costello's point. It would, in any event, be more convenient to discuss the amendment then.

Shall I put it down for the next stage?

If the Deputy thinks it necessary. I shall be moving an amendment to re-cast this section, which is too rigid as it stands. When the Deputy sees the redraft, he can, if he thinks it necessary, put down the amendment.

Shall I have time to do so?

I shall see that the Deputy has plenty of time to do so.

Amendment No. 170 not moved.
Section agreed to.
Amendment No. 171 not moved.
Section 88 agreed to.
Amendment No. 172 not moved.
Section 89 agreed to.
SECTION 90.
Question proposed: "That Section 90 stand part of the Bill."

I cannot see why, where we have foreign companies and Saorstát Eireann companies operating within the Saorstát, the Minister should require the Saorstát Eireann companies to furnish him with certain particulars which are set out in the body of the Bill, while, at the same time, exempting foreign companies from furnishing the same particulars. This section gives the Minister power to accept from foreign companies in lieu of the accounts, balance sheets, abstracts and statements which such company is required by the Act of 1909, or this Act, to make or deposit, copies of the accounts or statements, which such company is, by the law of the country in which it is incorporated or constituted, required to make or deposit. The object of this Bill is to set up a certain standard of insurance practice. In some respects, the standard set by this Bill is more rigid than that set in other countries. In certain particulars, the standard set by this Bill is more rigid than the standard set in Great Britain. I, therefore, suggest that we should prepare a schedule of accounts, balance sheets, abstracts and statements which every company operating in Saorstát Eireann will be required to furnish to the Government, whether such company be a foreign company or a Saorstát Eireann company.

The only purpose of the section is to allow the Minister to accept in lieu of the accounts, balance sheets, abstracts and statements for which the Bill provides, copies of documents of a similar character which the companies concerned are bound to submit under the law of their own country to the appropriate Government Department of their own country. These accounts, balance sheets, abstracts and statements must give precisely the same information as, or at least not less information than the information required under this Bill, and it is merely a matter of conveniencing the companies concerned to that extent. It is not proposed to allow the foreign companies to give any less adequate information on these matters than the Bill requires the Saorstát Eireann companies to give.

We may have an undesirable situation arising after that. If we do not set a standard form of documents for all the companies operating here, you may have one set of documents for the Saorstát Eireann companies, while the British companies will furnish a set similar to the set they furnish to the British Board of Trade and the British National Health authorities; then again, it may be that you have German companies having to furnish the same class of documents as the Saorstát Eireann companies.

Documents that give the same information.

If that is permitted, you will be asking a different set of documents from the Germans from what you will be requiring from the British. In that case it will be said you preferred the British to the Germans, or vice-versa. It might happen that we might find some lacuna in the British companies. In my opinion, the matter is purely an administrative one, and if the difficulty suggested by the Minister arises, his successor can introduce legislation to remedy it.

The provision is not mandatory.

Mr. Lynch

That is the whole evil of it. "May" does not mean "shall."

On the last occasion the Minister said that "may" meant "shall."

Section 90 put and agreed to.
SECTION 91.

Mr. Bourke

I move amendment No. 173.

Before Section 91, to insert a new section as follows:—

After the coming into force of this part of the Act—

(a) no foreign company shall undewrite a greater amount of new life assurance premium than 90 per cent. of the preceding year's new business total;

(b) all original proposal forms issued by foreign companies shall be retained in their Irish branch offices, and all new policies shall be prepared, signed, stamped and issued from such offices where a complete register of all policies shall be kept;

(c) the amount of policy stamps issued to foreign offices each year shall not be greater than 90 per cent of the amount issued the previous year.

In view of the attitude taken by the Minister, I do not think there is much use in pressing this.

I regard this as consequential on a previous amendment which was withdrawn.

Amendment, by leave, withdrawn.
Amendments Nos. 174 and 175 not moved.
Section 91 put and agreed to.
SECTION 92.
The revenue account which every assurance company is required by Section 7 (which relates to deposit of accounts with the Board of Trade) of the Act of 1909 to deposit shall, in addition to the matters required to be contained therein, contain and set forth the following particulars in respect of every class of assurance business carried on by such assurance company in Saorstát Eireann, during the period to which such revenue account relates, that is to say—
(c) the amount (including any unpaid instalments of the full annual amount of a premium) of the premiums (ascertained as nearly as may be) which are due and unpaid at the date at which such account is made up and for which credit is taken in such account.

I move amendment No. 176:—

In page 46, lines 22 to 26, to delete paragraph (c).

The object of the amendment is to delete paragraph (c) because of the serious practical difficulties it will occasion. Companies will have great difficulty in fulfilling their obligations if paragraph (c) is insisted on in this Bill. When the Bill was introduced originally it did not contain the words now in paragraph (c) of this section. The insertion of the words in parenthesis in this section—"ascertained as nearly as may be"—shows that the Minister has recognised the difficulties with which insurance companies will be faced in filling up these new revenue accounts with the particulars that are requested in the Bill. In the case of a company doing general business it will be extremely difficult, if not impossible, for it to give the particulars asked for. If the Minister would only consider the case of a company doing general business covering a variety of matters, for all of which there is only one premium payable in the case of all-in policies, he will find how difficult this sub-section will make the work for the companies. It would be a matter of the most extreme difficulty for any company to furnish the particulars asked for. I do not know what is the object in having this paragraph in the Bill which requires this information to be given in the revenue accounts. If it is for the purpose of ascertaining whether or not the companies take credit for premiums they have not received, then the Minister ought to put in that specifically, and he would achieve his object better by specifically requiring the information rather than put the companies to the considerable expense that this section will put them to. The fact is that they will not be able to give the information that the Bill is asking.

The outstanding premiums constitute part of the assets of the company and are included in the funds. They are an item which can be inflated by the inclusion of premiums which may never be received and are therefore fictitious. It is desirable on that account that the amount of the outstanding premiums should be disclosed. I think it will be necessary to introduce an amendment to this paragraph on the next stage and limit it to Saorstát business. That is merely a slight change without altering the principle. The purpose of getting this information is to enable the proper position of the company concerned to be ascertained. That could not be done unless this information was available. These outstanding premiums are part of the assets and are included in the insurance funds, which can be inflated by the inclusion of premiums which may never be received, and the extent to which outstanding premiums are included in the assets should be made known.

Has the Minister not considered the question which is really the kernel of the matter—that is, whether the premiums are paid as part of a composite premium? They need not be split up. They could be put in some way in which the premiums could be bulked together. The difficulty of the insurance company is that where they receive one insurance premium the Minister is looking for them to split it up.

In fact, the premiums are split up in the revenue account of the insurance companies.

But I understand that this would involve some further splitting up. I think the Minister should look carefully into that question. I think the Minister has an idea that the insurance companies are trying to get away with not disclosing these assets.

I do not think there is anything in it. A premium of that kind covering insurance in two or more cases must be split up in the various revenue accounts of the company.

The Minister refers to one or two cases. Take the case of a comprehensive policy which may cover burglary, accident, fire and third party damage.

In each case the relevant proportion of the premium must be credited to the proper revenue account.

Perhaps the Minister will look into the question and see how far he can meet the wishes of the insurance companies without giving away any detail that really matters to him. I think if he were to reconsider the matter he would find he could meet the insurance companies.

I think the companies are anxious to give whatever information the Minister wants. It is only the way he requires it in this sub-section that causes the difficulty. They believe that that will put them to considerable expense and possibly revolutionise their existing practice. If the Minister wants a certain thing done, if he would put it in specifically, it would meet the wishes of the companies.

Into whatever revenue accounts the company puts the premium, or part of the premium, then in relation to that account we will require the information, whatever process of splitting up is done when the premiums are being credited to the various revenue accounts. The information would be necessary in any event, and I believe this does not involve any further difficulty. The section provides that the information must be given in relation to any particular revenue accounts. As I have said, into whatever revenue account the premium or part of it is put, then in relation to that account we will require that information.

Surely the Minister does not think that the insurance companies do not wish to furnish details of particular revenue accounts? The difficulty that they foresee is that they will be asked to split up still further these revenue accounts.

Perhaps the Minister will look into that matter again?

They are not asked to do that in paragraph (c). This whole section merely relates to the information that must be given in connection with each revenue account.

There may be some small composite premiums which it would be difficult to split up into these particular revenue accounts and if the Minister will see his way to meet the companies in that respect they will be satisfied. They do not object, where they receive a separate premium for a separate risk, disclosing that information.

Is it not so that ordinarily a company would have a fire fund, an accident fund and so on and there would be no difficulty in maintaining those funds and affording the Minister all the information he wants under paragraph (c)? But it is suggested that the accident fund, for instance, should be further sub-divided.

There is nothing in this section about that.

The Minister can allay all our anxieties by hearing our difficulty and assuring us that it does not arise. An accident policy can be sub-divided into burglary or storm or a variety of specific accidents against each one of which a separate policy could be taken out, but in fact all of which would be covered by a composite policy. It did appear, in as much as the Minister put in the words "ascertained as nearly as may be," that he envisaged a situation in which the existing accounts would require to be further sub-divided and in such detail that he could not reasonably ask for an exact account, but only one "ascertained as nearly as may be." If the Minister says, "We have no desire for an account any more elaborate than the accounts ordinarily furnished"——

We want more elaborate information about the account, but we are not requiring any more accounts.

That is the whole problem. Does the Minister say that he requires any further sub-division of existing accounts than already exists in the case of the Irish companies and of which he has information?

No further subdivision will be required.

How will the Minister check the figures that will be furnished to him under paragraph (c)? If the amount of the premiums outstanding is to be ascertained "as nearly as may be," will he not be depending upon the honour and truthfulness of the companies for the correctness of the information?

It is clear, if the amount of outstanding premiums is an appreciable sum, that is a fact which anybody endeavouring to ascertain the position of the companies should have knowledge of and the purpose is to see that that particular item will be brought out separately and shown separately.

Amendment No. 176, by leave, withdrawn.
Sections 92 and 93 agreed to.
SECTION 94.
(1) Every assurance company which carries on mechanically propelled vehicle insurance business shall, in addition to the statement which such company is required annually to prepare in pursuance of paragraph (d) of sub-section (2) of Section 76 of the Road Traffic Act, 1933 (No. 11 of 1933), annually prepare a statement of the estimated liability of such assurance company in respect of outstanding and unsettled claims relating to such business.

I move amendment No. 177:—

In sub-section (1), line 15, to insert after the word "business" the words "in Saorstát Eireann".

The object of this amendment is to make it absolutely clear that the additional information required by this section should relate only to the business of a company that is effected in Saorstát Eireann. Probably it is clear enough, but it is to put the matter beyond all possible doubt. As the section stands it might be taken to mean business here or abroad. Presumably the object of the Minister is merely to get information in reference to business effected here. The words "in Saorstát Eireann" will make the matter completely free from doubt.

An amendment would be necessary to confine the returns to returns in respect of business arising in Saorstát Eireann and I think we could accept the Deputy's suggestion. It would be unreasonable to expect a foreign company doing 95 per cent. of its business outside to submit returns in that connection.

Amendment agreed to.
Section 94, as amended, and Section 95 agreed to.
SECTION 96.

Mr. Bourke

Amendment No. 178 is consequential on an earlier amendment, an alternative proposal to the Minister's partition proposals, and, as the original amendment was not accepted, I do not propose to move this amendment.

Amendment No. 178 not moved.

I move amendment No. 179:—

At the end of the section to add a new sub-section as follows:—

Where an assurance company carries on life assurance business or industrial assurance business or both such businesses in Saorstát Eireann on the 31st day of October, 1935, and is granted a licence to transact such business or businesses in accordance with Section 12 of this Act the Minister shall allow a period of not less than three years within which to comply with sub-section (1) of this section.

The object of this amendment is merely to gain sufficient time to enable the companies to make the necessary internal arrangements to effect the separation required by the section. At the moment the Minister could bring this part of the Bill into operation with very little notice. It would take some time to effect the change required by the Minister and the period of three years is set out as a reasonable period.

I am not averse to the principle, but I think the period suggested is much too long. In the Clausen Committee Report, in the portion dealing with this matter, the period of nine months is suggested. I would agree to that period, or even the period of a year.

12 months.

If the Deputy will leave the matter over to the next stage, I will introduce the necessary amendment.

I am quite satisfied.

Amendment No. 179, by leave, withdrawn.
Section 96 agreed to.
SECTION 97.
(1) The Minister, if and whenever he thinks proper so to do, after consultation with such assurance companies as he thinks fit or with any association representing assurance companies, may by order (in this section referred to as a rates of premiums order) fix the rates which may be charged by assurance companies by way of premiums in respect of all or any classes of contract in any class of assurance business other than life assurance business or industrial assurance business.
(4) Whenever and so long as a rates of premiums order is in force in respect of any class of assurance business, no assurance company shall charge for any assurance within such class of assurance business a premium which is greater than the appropriate premium fixed by such order.

I move amendment No. 180:—

Before Section 97 to insert a new section as follows:—

(1) A Saorstát Eireann company shall not be liable to affix stamps on policies of life assurance or on receipts for moneys received by it for a period of ten years from the passing of the Act.

(2) A Saorstát Eireann company shall not be liable to pay stamp duty in respect of a transfer of shares whether the same be by sale or purchase of any stock, shares or other securities, where such stocks, shares or other securities have been, will be or would have been but for the said sale having taken place within the financial year of such company, included in the assets of such company.

(3) The profits, if any, of a Saorstát Eireann company shall not be liable for income-tax and/or corporation profits tax for a period of ten years from the date of the passing of this Act.

This amendment is generally directed to provide a preference for Irish insurance companies, and when I say Irish I mean Saorstát Eireann, by exempting them from the duty of affixing stamps on policies for a period of ten years, exempting them from the payment of stamp duty on the transfer of shares and exempting them from income-tax, or corporation profits tax, for a period of ten years from the passing of the Act. I doubt if the principle will commend itself to the Minister.

I feel that the Deputy and I would have to carry this amendment over the dead bodies of the Revenue Commissioners and I do not feel equal to the struggle.

I take it, then, that the principle of the amendment does commend itself to the Minister.

In one respect I think that it would be entirely undesirable to effect any such provision as the Deputy suggests, and that is in relation to income-tax. I think that the principle on which the Revenue Commissioners have always stood, that there can be no exemption from income-tax, is a sound one. If it is desired to give financial assistance at the expense of the revenue to any concern, it should be done directly by grants and not by remission of tax in this way. In any event, these are revenue matters and I could not undertake to accept the amendment. The Deputy will have to fight it another day.

Is it not a remarkable fact, in view of the statement of the Minister that the Revenue Commissioners stand on the ground that concessions of this kind must never be made, that in Great Britain the great industrial insurance companies there are exempt from income-tax on that part of their profits which they distribute as a bonus to their policy-holders?

I am not familiar with the income-tax laws in Great Britain, and neither am I too familiar with the income-tax laws here.

The Minister has abundant opportunities of ascertaining the truth or the untruth of what I am telling him now.

I simply put this to the Deputy: that it is a sound principle if this Dáil wants to give financial assistance to Saorstát insurance companies, it should be in the form of a direct grant subject to the control of the Dáil, and not in the form of remission of taxes imposed by the legislature to be payable by all persons affected.

How many members of the House realise that the British insurance companies pay no income-tax? They do not pay corporation profits tax at all, because there is no corporation profits tax in Great Britain, but they pay no income-tax on that part of their profits which they distribute in the form of a bonus to their policy-holders. Therefore, for every £1 that they segregate for the purpose of distributing as a bonus to their policy-holders, their policy-holders get 20/-. But the Irish companies must pay income-tax, not only on the profits distributed to their shareholders, but also on the profits distributed as a bonus to their policy-holders, so that out of every £1 set aside by Irish insurance companies for distribution as a bonus on policies, the Irish policy-holder gets only 15/-. Had he held his policy with a British company he would get 20/- for every £1, but because he takes a policy with an Irish company he can only get 15/-. Is it unreasonable, in the light of those facts, that the Irish companies should get some slight concession? The Minister, at this juncture, throws the Minister for Finance into the breach, and the Minister for Finance discreetly absents himself. In view of some of the matters that I intend to raise on the Schedule, dealing with amalgamations. I do not propose to press this amendment.

Amendment, by leave, withdrawn.

I move amendment No. 181:—

In sub-section (1), line 14, before the word "may" to insert the words "and with persons who are in his opinion representative of insured persons."

I think that insured persons ought to have an opportunity of putting forward their views when the rates are being fixed, and I, therefore, ask the Minister to accept the amendment.

I do not think that I can accept the amendment. I do not know who would be regarded as persons "representative of insured persons." I think that the Minister himself, in any circumstances, would answer that description as well as anybody else could. Although the Minister's action would, probably, in every case be taken as a result of complaints addressed to him by insured persons, nevertheless, I do not think that he should be under a statutory obligation to go seeking the persons who would answer the description set out in the Deputy's amendment, and consult them before taking action. While in a sense that is what will happen, it would be impossible to impose that as a statutory obligation. There is no organised body that you could take as representative of insured persons in every case. The representatives elected by the people to this House are, probably, more likely to answer that description than any other body.

Amendment, by leave, withdrawn.

I move amendment No. 182:—

In sub-section (1), line 16, to delete all words from the words "all or any" to the end of the sub-section and substitute the words:—

"(a) employers' liability insurance business:

(b) mechanically propelled vehicle (third party) insurance business."

This amendment has for its object the deletion of the wide general power of fixing rates of premiums which is proposed to be conferred on the Minister by the section as it stands, and of confining that power to two particular classes of insurance, namely, the employers' liability, and insurance in respect of mechanically propelled vehicles—third party insurance. The reason why these two particular classes of insurance were selected was because there is either a statutory obligation or something very nearly approaching a compulsory obligation to insure, and the case might be made that, in reference to a class of insurance where people are under a statutory obligation or almost a compulsory obligation to effect policies of insurance, the Minister might have the right to interfere. In reference to the wide general power that is conferred on the Minister by this Bill to interfere and fix rates of premiums, there is no real justification whatever for that. The fixing of rates of premiums for insurance business is a very technical matter governed by technical rules and based on wide experience. Interference in that class of business by a Department of State or the head of a Department of State might seriously affect not merely the interests of companies but of policy-holders or of prospective policy-holders. The outstanding case of that time that may be affected is what is known as poor risks, where companies take on risks, which they would not ordinarily undertake, at a slightly increased premium, merely for the sake of getting other business. If, in that class of case, there is interference by the Minister, or an order fixing rates of premiums, then it will probably be dropped and possible policy-holders will be seriously prejudiced. Poor risks will not be undertaken at the rates fixed by ministerial order, and the people who want to effect those risks, and are prepared to effect them at a slightly increased premium, cannot do so. What the section proposes is, in our opinion, quite unsound. The amendment aims at something in the nature of a halfway house. In regard to workmen's compensation or insurance in relation to mechanically propelled vehicles, the power proposed to be conferred on the Minister might, with some degree of reasonableness, be held to be justified, but as regards the general proposition that the Minister should interfere and fix rates in all cases, there is no possible justification whatever for that.

The Deputy's amendment proposes to confine the Minister's power to regulate the rates of premiums to employers' liability insurance business, and to insurance business relating to mechanically propelled vehicles. The whole section, of course, is designed to give the Minister power to protect the public against the possibility of exploitation under the circumstances that will arise when the Bill comes into operation. I think it is desirable that he should have that power over a wider range of insurance business than the two classes of business referred to in the Deputy's amendment. I do not say that, however, with very great emphasis, because I can see considerable practical difficulty in exercising the power conferred by the section in connection with many classes of insurance business, such as fire insurance or other business of a similar class. At the same time, it has to be recognised that there will be a limitation upon the number of companies doing business here, and certain difficulties imposed in the way of new companies entering the business. In fact, so far as foreign offices are concerned, they will not be able to enter into the insurance business here unless they were doing it on the qualifying date in 1935, and, so far as new Saorstát companies are concerned, there are certain requirements to which they must conform before they can get a licence.

In the case of fire business, where probably the weight of the argument on practical grounds is greatest against me, because the operation of the power in the case of fire business would be a very difficult matter, there will, nevertheless, be a situation in which there will be little if any competition against the tariff offices. On the whole, I think it is desirable that there should be this power, power which would only be used in very unusual circumstances, because of the difficulties associated with its use. But as a check against the possibility of policy-holders being exploited, I think it should be there. I am prepared to consider the elimination from the scope of the section of other classes of business than life business, such as bond investment business, but I do not think it is desirable that we should narrow the powers of this section in such a way as to confine them only to the two classes of business mentioned in the Deputy's amendment. I have not, as I indicated, I think, by the words I used, a very fixed opinion in relation to the matter. But, on the whole, I think it is desirable that we should have this power and have it in relation to a greater number of classes of business than the two mentioned in Deputy Costello's amendment.

The reason and the line of the amendment being that the two classes he mentioned are the only two classes of business in respect of which——

Which are compulsory or semi-compulsory.

——in respect of which there is a statutory obligation to engage in, it becomes difficult to say at what point Ministerial interference should be checked and where Ministerial interference becomes pure State socialism. I think the further we go in the Bill the more manifest it has become that the Minister is determined to run the insurance business on State socialistic lines before very long. Whether it is desirable to create a sense of false security by restraining his activities in the earlier stages of the Bill or not is doubtful. We are much in the same position in this matter as we are to the tariff and Price Controller situation. The Minister says "I create a grave menace of exploitation and profiteering by my tariffs, but the operations of the Price Controller are sufficient to abate the evils." Here, he says, "I am going to set up a virtual monopoly in general insurance business confined to three companies in this country——"

Confined to perhaps 60 companies.

What do you mean?

There may be 60 companies licensed to do general business under the Bill.

After there has been division of the two businesses, life from general?

If so, 57 of them will be foreign companies.

Doing general business?

Doing general business here and licensed to do it under the Bill.

The Minister thinks we are very innocent. Does he not know that virtually all life business will be gathered together into one company, with the Irish Insurance Corporation and the Hibernian Insurance Company doing the general business in this country?

What about the foreign companies?

This is going to create a virtual monopoly confined to two or three companies doing fire and general business. The Minister wants to do that and he says, "In order to provide for the contingency arising therefrom I am going to control premium rates." Suppose there are 60 companies. What case did the Minister make for fixing premium rates in fire insurance? If there is to be free competition between the 60 companies for the business——

I did not say there was going to be free competition. It is because of the possibility that there may not be that I think this power should be there.

The Minister sometimes reminds me of the Red Queen in "Alice in Wonderland" because his interjections are wholly irrelevant.

The Deputy reminds me of a prophet in his own country.

What relevance have the 60 companies to the argument?

I was merely proving that the Deputy was wrong, which is always a pleasure to me.

Let us not get into exchanges of that kind, because the debate is likely to become attractive if we engage in exchanges of that character. If there are going to be 60 companies competing for fire and general business, there could be no defence whatever for giving the Minister any right to intervene for the purpose of controlling premiums. If, on the other hand, the Minister is going to create a monopoly, something may be said for it. But, if that evil is going to arise from the creation of a monopoly, in my opinion that is more an argument against the creating of a monopoly than an argument for giving the Minister a right to control premiums. The Minister now says that 57 companies are going to engage in fire and general business in this country.

I think there are that number of foreign companies who will qualify for a licence.

He says they are going to compete for the business in this country. On the basis of that statement, can the Minister justify his vesting in himself the power to control premiums for fire and general business?

I cannot do it except on the grounds I have already indicated.

The ground indicated before this was that the business was going to be in the hands of a couple of companies.

I did not say anything of the kind.

What justification did the Minister give?

I said that in the fire insurance business there will be practically no competition, or very little competition with the tariff companies.

Why? Are not all the British companies tariff companies?

Not all.

Practically all. Of the 57 companies operating here, 50 are tariff companies. What does the Minister mean by saying that there will be no competition against these companies?

I said there will be none with these companies.

There will be the competition of the seven remaining companies which are not tariff companies.

I do not think it will be sufficient.

Surely if seven companies offer to do fire insurance at a premium substantially lower than the remaining 50 companies, the seven companies will get all the fire insurance business. That seems to be perfectly clear.

The Deputy should know that under the Bill as it stands Lloyds will not be doing that business.

The reinsurance corporation will be doing it.

The Insurance Corporation of Ireland is a tariff company.

This is talking in circles. There are going to be 57 companies doing business here; 50 of these will be tariff companies, inasmuch as they will have a tariff agreement with the reinsurance corporation, and the balance, which the reinsurance corporation refuses to reinsure, will be passed on.

What does the Deputy mean by a tariff company?

In the existing circumstances, it means a company engaged in the tariff ring in Great Britain, which is admitted to tariff treaties of reinsurance, and admitted to them on the basis of some agreement as to the premiums charged and the nature of the risks taken. Outside that, there is a considerable body of companies who negotiate their reinsurance with Lloyds or Continental reinsurance companies of one kind or another. If the Bill is passed, there is going to be compulsory reinsurance with the Reinsurance Corporation of Ireland, in so far as that corporation wants to take the risk. Is not that so?

Perhaps.

If Part VI of the Bill is put into force. The remainder of risks must be provided for as heretofore in one way or another. The British companies can, I assume, reinsure any balance which the Irish Reinsurance Corporation will not take with the tariff ring in England. Those Irish companies and other foreign companies who are not in the British tariff ring will reinsure part of their general business with the Irish Reinsurance Corporation.

I think all, or practically all, the Saorstát companies are tariff companies.

I do not know whether the new Irish Reinsurance Corporation is in the ring or not. The Hibernian is, of course, because it was a British company, and it has only recently been bought over by an Irish group of financiers within the last two or three years.

That has nothing to do with it. I think that, with the exception of one, they all are.

It was owned by a big British company, and the Minister knows that.

That has nothing to do with it.

Yes, it has. It is brought into the tariff ring by the company which bought it.

It was a tariff company before it was bought.

What is the relevancy of that? It is merely a red herring which is being thrown in by the Minister to distract public attention from the fact that he is seeking powers which cannot be justified on any grounds, and seeking the right to fix premiums under the section we are discussing. He argued that this is necessary, because there will not be sufficient competition against the tariff bloc, and he says that the tariff bloc consists of 50 companies. I say that there will be seven companies outside of that, and to that proposition the Minister assents.

No; the figures are the Deputy's.

How many companies will there be outside the tariff ring when licences are issued under this Act?

I have no idea.

Nevertheless, the Minister is prepared to found his whole case for the powers in this section on the ground that there will not be sufficient competition against the tariff companies, but he has not got the faintest notion of how many tariff companies and how many non-tariff companies there are. That is the basis on which this section is being discussed, and the Minister himself says he has not the vaguest notion what the nature of the competition will be. Is it beginning to dawn on Deputy Moore that he is being led up the alley?

I did not think it would. However, my submission is and my figures stand until the Minister contradicts them, that out of the 57 companies eligible to do business under this Bill of a general and fire character, 50 will be in the tariff ring and seven outside. I say that these seven will provide adequate competition to keep premiums at a reasonable level from the point of view of the policy-holder. Therefore, the Minister ought not to have statutory power to fix premiums when no danger threatens the policy-holding public of this country. I allege that he wants that power simply for the purpose of facilitating him in a gradual regimentation of the insurance business, with a view to nationalising it, at the same time as he nationalises, or attempts to nationalise, a good many other commercial enterprises at present operating in this country, in order to go as far on the road to State socialism as he thinks it safe at any given moment to go. In my opinion, he will not get to first base, because he will be kicked out before he gets half way, but I believe this section is part of a general scheme to facilitate nationalisation of the insurance business, and that that itself is only one small part of a larger scheme to nationalise a wide scope of commercial activity in this country, which I look forward to seeing fail, and which I think the Minister is foolish enough to hope will succeed.

In my opinion, a minority of non-tariff companies would not in itself be sufficient security against impossible rates. It would depend entirely on the quality of those companies.

They are all guaranteed by the Government under this Bill.

It has always been the case that a non-tariff company is prepared to undercut, but that affects very little the business of the average tariff company. May I submit that whatever defect the section may have, the amendment would have many more defects? The amendment proposes to give the Minister power to fix rates with regard to two classes of insurance, insurance in respect of mechanically propelled vehicles and another class. With regard to insurance affecting mechanically propelled vehicles, it has very often been held, and, in fact, I think is generally held, by the companies doing that insurance, that it is not a paying proposition at all.

I have heard that gag, too, but they still go on doing it.

They do, and that is the point. If it is associated with other classes of insurance and if the Minister were to take power to fix premiums with regard to that class of insurance only, it would create a totally new situation for the companies. He would be creating a situation which would affect the general policy of the companies to a considerable extent, because it is the case, at present, that companies doing that class of business are prepared to lose on insurance affecting mechanically-propelled vehicles so long as they gain by insurance closely associated with it. If they are subject now to a fixed premium in respect of motor insurance it means that the Minister's interference must be directed towards making such insurance a paying proposition in itself. That is not a proposal that would be consistent with the Deputy's general criticism of the Bill. His general criticism of the Bill is that it may make insurance expensive. He has been pleading for the insurer, but the effect of his amendment would be probably to increase the rates of one particular class of insurance which affects a great number of people and an increasing number of people all over the country. I submit that, whatever defects the section may have, the amendment has much more serious defects.

It occurs to me that possibly Deputy Moore has mistaken the meaning of the amendment. As I understand it, it is put forward, not as being advisable or desirable that the Minister should have power to fix rates for any class of insurance, but as being a lesser evil than the giving of comprehensive powers that the Minister should be authorised to fix rates for particular classes of insurance where a special case can be made. If that be right, Deputy Moore's argument falls to the ground.

Heavily.

In the case of the two classes mentioned in the amendment, insurance in regard to mechanically-propelled vehicles and employers' liability insurance, there is in one case the absolute compulsion in law upon persons to cover themselves in respect of those risks, and, in the other, there is, if not an actual compulsion, a practical compulsion. By law, any person driving a mechanically-propelled vehicle is bound to cover himself with an insurance policy. An employer is practically bound, having regard to the Workmen's Compensation Act and the liabilities he has to his workmen, to cover himself with an insurance company against those risks. That being so, it might be urged, and, no doubt, would be if the section as a whole were to go, that a special case could be made for these two classes, but the object of the amendment is not to suggest that that is necessary. The object is to narrow the evil which a wide power embracing all classes of insurance would make for. I suggest it is a better principle to go upon to indicate the particular subjects to be covered rather than to give the Minister the widest power of fixing rates for all classes.

The undesirability of giving to the Minister, or to any Minister or Department, the power to fix matters which ordinarily ought to be regulated by free competition among companies and other bodies looking for business of a particular kind has been urged in other matters, and certainly I think it will be admitted that the ideal is to allow business to be conducted without State restriction and without State obligations being imposed upon the parties. I understand that the Minister is afraid that the competition in this case between insurance companies offering to cover risks will not be sufficient to bring rates to the level at which they ought to stand having regard to the risk involved. Does the Minister think that, by taking power to fix rates—presuming that a rates order would fix a maximum rate—he is going to remedy that state of affairs? After all, it is not proposed that fire insurance should be made compulsory on the individual, and it is certainly not proposed that insurance companies should be laid under a compulsion to cover any fire risk that is offered to them. I do not know how the situation should be met —how a particular person would feel he would be affected by a rates order if a rates order were fixed and if, as a result of that order, any insurance company refused to cover him at that risk. The position of that person then would be that he would have to go uninsured, I suggest.

I suppose there is no class of insurance in which more risks are involved, from the companies' point of view, than fire insurance. Some classes of property, possibly, go without fire insurance because they are not so much exposed to the danger of fire, but all classes of property or premises which are peculiarly vulnerable to fire risks are described by insurance companies as poor risks, and I do not know how the Minister is able to say that he believes demands should be met if he is going to say that a rate should be fixed and if the insurance company concerned is not to be free to say to a particular person: "We cannot cover you at such-and-such a rate, and if that rate exceeds the maximum then we cannot cover you at all." Apart from the merits or demerits of exercising State control in a matter of this kind, I really think that this is going to be a disservice to people who might be able to get cover, and that it is really going to leave them without the possibility of getting cover at all.

Is amendment No. 182 withdrawn?

Has the Minister anything to say with regard to Deputy Lavery's point?

I think I dealt with that point already, and I do not like to speak about the same matter twice, if I can avoid it. However, I realise that there may be some difficulty in differentiating between cases, as Deputy Lavery has pointed out. At the same time, I think the power should be there — recognising, of course, that that power should only be used in very exceptional circumstances, and only where the actions of the insurance companies concerned would be such as would demand that drastic action should be taken to prevent the exploitation of policy-holders. I admit that I am not very definite about this power, but I think we should have it in regard to all classes of insurance except life business. I admit, however, that the application of these powers, if it should be necessary to use them, would be a difficult matter.

Can the Minister give us an instance of this power in any other country?

I do not think so.

I do not think there is any such power in any part of the world. However, with regard to what Deputy Lavery has suggested, would the Minister consider, between this and the next stage of the Bill, fixing a limitation of this power and confining it to a certain class of risk so that insurance companies would know where they stand? I think, from what the Minister has said, that he recognises the difficulties of fixing rates generally, and I think it would probably be very much to the advantage of the proposed policy-holders, and also of the companies concerned, that the power should be limited to certain specified classes of insurance policies.

But it is at the moment. The power is limited at the moment.

Yes, it is limited in the sense that the word "Iceland" is limited. However, there is a vast class of insurance to which this may apply, and there are other classes of insurance to which, I think, it could not in practice apply. For instance, if the Minister started to fix a rate for the insurance to be fixed for a saw-mill, I think he would find some difficulty in doing so, and I suggest that if he would address his mind to fixing the rate of insurance for a saw-mill he might realise his difficulties and be able to limit still further than at the moment the classes of insurance that would be included in this power.

I am inclined to agree, to the extent that, if profiteering in insurance—or, for that matter, in any other kind of business—were being carried on, where there is difficulty in price fixation, there are other methods that can be applied and can be more effectively used for that purpose.

Hear, hear!

I do not think Deputy Dillon would agree with the methods I have in mind, despite his rather rash approbation. However, as I was going to say, I am prepared to think this over. At the same time, I think this particular method of control should be retained in case there is need for it, and I think it will be admitted that that need might exist where, in the new circumstances, a limited number of companies will be licensed to do certain classes of business. There might be only one company in a particular class of business. However, as I have said, I shall consider the matter.

Amendment No. 182, by leave, withdrawn.

Mr. Bourke

I move amendment No. 183:—

In sub-section (4), line 33, after the word "greater" to insert the words "or less than".

This section is really one of the most obnoxious sections of the whole Bill. It represents, so to speak, the high-water mark of the tendency that has been so obvious nowadays towards bureaucracy—the tendency to interfere with everything and to insist on having control over everything and everybody, while, at the same time, shirking responsibility—the tendency to adjudge and control while, at the same time keeping Pontius Pilate's finger-bowl alongside. I think the effect of the Minister's statement is that everybody realises the difficulty of enforcing regulations of this kind. The fire business varies in every case. Even in the case of a company getting a particular business, say, in one street, the fire business may vary. There might be four or five houses of a different kind in the same area and that makes it necessary for the companies concerned to change their attitude and get different premiums from the occupiers of the different houses. The Minister, I am sure, realises what a difficult problem that presents, and I suggest that, in such circumstances, such drastic powers as are here proposed should not be given to a Minister. Deputy Costello made a case for varying the Minister's attitude towards fire insurance as against motor insurance and employers' liability insurance. However, I really do not think there is very much force in that. Certainly, the fact that it is obligatory on these people to insure is something in their favour but, at the same time, two wrongs do not make a right, and it does not get over the difficulty of getting motorists to insure by asking insurance companies to take them at a rate that will not make it a paying proposition. In this and every other business competition will look after the question of maximum premiums. In the cut-throat competition that there is in this particular line of business in the Saorstát there is not the slightest danger that the companies will go in for profiteering. As a matter of fact, one of the reasons given as a justification for an Insurance Bill being brought before this House is the fact that the companies have been inclined to undercut. I know that in connection with motor insurance business certain companies have taken business at half the tariff rates, and even at these rates most of it is not paying business, owing to the fact that there is exceptionally high damage. It is not a paying business and the companies only undertake it to increase their incomes. Very few companies are inclined to go mad about motor insurance. If the Minister insists on maximum premiums, as a counterbalance he should insist also on having minimum premiums, and should see that companies trying to do business in a straightforward way, and with funds adequate to meet their liabilities, are not going to be penalised by those that are less conscientious.

Deputy Bourke, having said what he has said on this matter, is, I expect, satisfied and does not expect me to accept the amendment. I do not think we should take power to fix minimum premiums for any class of insurance business. This section is intended merely to prevent exploitation of the public, and any extension of the section in the manner suggested would be undesirable.

Mr. Bourke

Does not the Minister agree that what I said has taken place in the past?

I am not quite sure. I agree that there is substantial evidence to show that numbers of companies have found third party motor vehicle insurance business unprofitable. It does not apply to all companies.

Amendment, by leave, withdrawn.
Section 97 agreed to.
SECTION 98.
Question proposed:—"That Section 98 stand part of the Bill."

I should like to hear the Minister on this section.

The Deputy will not have that pleasure.

I think I had better read the section:—

Whenever a form of proposal for a policy of assurance is filled in wholly in the Irish language every policy of assurance issued in pursuance or as a consequence of such proposal and any other document issued in connection with such policy by the assurance company to which such proposal was made shall, if the proposer so requires, be issued by such assurance company in the Irish language.

In the history of codology was there ever greater codology than that? If so I have yet to hear it. What fool is responsible for putting that in? There is a statutory obligation on insurance companies to issue policies in Irish on request. Is not that codology? Does it not bring the language movement into contempt? Does it not bring a blush of shame to the cheek of anyone who ever advocated the promotion of the Irish language movement? God knows, when you spend years encouraging the promotion of the use of the Irish language in this country you find yourself being brought out to be made a fool of by an imbecile section of this kind being put into an Insurance Bill.

The Deputy is not alleging that we made a fool of him.

When I see the Minister for Industry and Commerce, who does not know the word for cat, pig or goat in Irish, it makes me feel a fool after having spent 15 years of my life learning the Irish language. It makes it ridiculous.

I did not do it.

You put that section into the Bill. The implication outside is that the Irish language movement is codology. No one wants that position except the pious warriors who are going around hoping that they will get jobs by the pretence that they are more enthusiastic Gaels than their neighbours. No one who has any regard or respect for the language desires to be associated with codology of that kind. The people responsible for introducing this section into a Bill of this character do the Irish language nothing but harm. They bring it into disrepute and ridicule, and as far as I am concerned I think the section is greatly to be deplored. It brings something to which I attach great value, and a movement for which I have deep respect, into disrepute. It is a humiliation for anyone associated with it.

I would like to associate myself with the remarks made by Mr. Dillon. I asked the Minister when this section was considered on the Committee Stage if it was a joke. I hardly believed that it was seriously intended. Apparently it is going in as a joke and a futile joke. The Government that is responsible for putting this futile section into the Bill and into legislation passed in this House is going to make the House and the country a laughing stock.

I rise at once to refute everything that Deputy Costello has said. The Deputy's position for the past two weeks has been that insurance law should be framed to meet the desires of the insurance companies. They do not want a provision of this kind. In fact, a very large number of them are in the position in which they will issue insurance policies in the Irish language to those who request them to do so. I think this is a very desirable provision, and that they should be required to do so when persons doing business with them so desire. Any company not prepared to conform to that condition is not required to do business here.

Why should there be a statutory obligation? It would always be open to persons taking out policies to give their custom only to companies providing policies in Irish.

It is not enough. We are making it a condition for any company which takes out a licence.

It is codology masquerading as patriotism.

We have had enough codology from the Deputy for the last fortnight.

Question put and declared carried.
SECTION 99.
(2) Where an assurance company has committed an offence under this section, every director, manager, secretary, or other officer of such company who is knowingly a party to the commission of such offence by such company shall himself be guilty of an offence under this section and shall on summary conviction thereof be liable to such fine or fines as are mentioned in the first sub-section of this section.

I move amendment No. 184:—

In sub-section (2), line 54, after the word "secretary" to delete the words "or other" and in line 55 after the word "officer" to insert the words "or employee".

I do not propose to say much about this amendment. I know that there is no legal difference between "officer" and "employee."

I accept the amendment.

Amendment agreed to.
Section 99, as amended, agreed to.
SECTION 100.
(1) Notwithstanding any provision in any British statute or Act of the Oireachtas limiting the period within which summary proceedings may be commenced, proceedings for an offence under the Act of 1909 or for an offence under this Act may be commenced at any time within six months from the date on which evidence, sufficient in the opinion of the Minister to justify a prosecution for the offence, comes to his knowledge, or within one year after the commission of the offence, whichever period is the longer.

I move amendment No. 185:—

In sub-section (1), lines 11 and 12, to delete the words "whichever period is the longer" and substitute the words "but not in any case after more than three years from the commission of the offence."

This amendment governs the next one.

Not necessarily; they are closely analogous.

If the Deputy has a different point he may raise it.

I do not wish to condone any insurance company which has committed an offence, but I think there ought to be some statutory limitation. I do not know whether the three years would commend itself to the Minister, but certainly some period ought to be fixed by which some possibly vexatious prosecutions might be prevented.

I think it is perhaps not unreasonable that there should be some limit, but I think three years is much too short a period. Certainly I could not agree to accept Deputy Dillon's amendment, which would have the effect of confining it to one year. I might be prepared to consider the insertion of an amendment providing for an overriding period of six years. I think it might be quite possible to conceal offences for more than three years. It might even be possible to conceal offences for six years, but I agree that there should be some limit. I would be prepared to accept six years, but I would be very slow to consider any shorter period.

Does the Minister realise that the usual period within which summary proceedings must be brought is six months, and that this section is provided in order to take those cases out of that particular limitation? Surely, if a six months' period is ordinarily sufficient, three years is not too short a period to allow?

Of course the circumstances here are different. The proposal here is similar to that which has been embodied in unemployment insurance law since its inception.

The proposal, in my experience of the working of unemployment insurance, is very bad. Stale claims are resurrected by the officials in defence of the fund for which they have a tremendous admiration in the Minister's Department.

It can frequently happen that knowledge of the fact that an offence has taken place may not come to light for years afterwards, when a repeat claim is made, or something of that kind.

The amendment proposes that the Minister should have a reasonable period within which to gain that knowledge. I think Deputy Dockrell's period of three years is rather long, having regard to the fact which has been pointed out by Deputy Lavery—that six months is the ordinary period. Certainly I would think that the period of six years suggested by the Minister is entirely too long. The facts may come to the knowledge of the Minister after a lapse of five or six years, and the evidence to refute those particular facts which come to the knowledge of the Minister may have long since passed away. Evidence that might have been available to the person who is going to be prosecuted will probably, after a lapse of five or six years, have completely vanished or be unprocurable, and the only result might be that the person prosecuted after the lapse of such a considerable period would be quite unable to know what it was all about or to defend himself adequately. The Minister should remember that what is being created here is a summary offence. Therefore, it would be what is called in the Constitution a minor offence—not of a very serious character —and consequently I do not think it is desirable as a matter of principle that after such a long period as the Minister has suggested a person should be prosecuted in reference to minor offences.

My personal feeling is that it is proper not to have any limitation at all, but I am prepared to say that I cannot find strong arguments against the proposal that there should be an overriding maximum period. I think six years would be not at all unreasonable, because having regard to the nature of this business, the long-term contracts that are made, and so forth, it may well happen that a considerable period may elapse before the knowledge that an offence has been committed will come to light.

As between the suggested periods of three and six years, would the Minister consider between this and Report Stage whether six years is not too long? I think it is a little bit too long. If the Minister will look at the various offences which are created by this Bill I think he will find that a six years' period is a little bit unreasonable, having regard to the type of offence.

I think that in regard to prosecutions for customs and revenue offences of that type a period of three years is already provided. I am not positive, but that is my idea.

That may be so. I am concerned only with the nature of the offences which are specified here. I will just give the example that the valuation which each company is required to undertake operates only once every five years, and I think the period must therefore be some time longer than that, if, as a result, information that an offence was committed is brought to light.

Surely that would be ascertained before five years?

It is six months after the knowledge has come to the Minister but not more than six years altogether.

After the date of the offence?

I would suggest that a six years' period is far too long. It is a very bad precedent.

I will accept the principle of an overriding maximum period, but I will consider the period.

Amendment No. 185, by leave, withdrawn.
Amendment No. 186 not moved.
Section 100 put and agreed to.
Question proposed: "That the First Schedule stand part of the Bill."

The First Schedule is the Schedule which implements the amalgamation scheme under this Bill. This Bill has been one of very great complexity, and its full significance did not I believe present itself to most Deputies of this House until after a somewhat protracted debate, but from this Committee Stage it now clearly emerges that it will not be possible for any Irish solvent insurance company to carry on its business in this country. It is an astonishing thing that the effect of this Bill is going to be that an Irish company which has become insolvent is going to be carried on in perpetuity, or an English company which has been operating in this country is going to be carried on in perpetuity.

I fail to see what this has to do with the Schedule.

The only company which this Schedule is going to make it impossible to carry on is a solvent Irish company.

This Schedule has nothing whatever to do with that.

Yes; it has.

I submit that this Schedule refers to a particular section of the Bill. It defines the conditions affecting the amalgamation of companies, but we have already discussed the sections which provide for the amalgamation.

The conditions provided in this amalgamation Schedule result in the facts as I have just stated them. In my opinion it is unjust on the part of this House to adopt any Schedule which operates to destroy a business which has been legitimately built up——

This Schedule does not affect any business.

——and kept within the law. I believe that this Schedule forms part of a general scheme which the Minister for Industry and Commerce has in his mind for the unification of the life and industrial life insurance business of this country under one large British combine. I believe that when he has it assembled under that British combine he proposes to nationalise it as a body in insurance analogous to the Electricity Supply Board in the distribution of electricity. I think it has become clear from an interjection made by the Minister in a debate on another measure which he was presenting to this House that he is now prepared to accept the philosophy of State Socialism; that he now takes the view that businesses of most kind can best be carried on by the Government, and should be carried on by the Government so long as he is entitled to run them. He very wisely has made up his mind that the rank and file of his own Party either do not take the interest or have not got the intelligence to see whither he is going.

Complimentary, no doubt.

He believes that by whipping them up every now and then he can persuade them, in the sacred name of patriotism, to help him in socialising the entire life of this country.

"The socialisation of the entire life" of the country is not relevant to this Schedule.

I am entitled to suggest that the intention behind the amalgamation scheme contained in the First Schedule to this Bill is Socialism.

Which paragraph does the Deputy refer to?

The Minister will get plenty of information before I am finished. He will get all he wants. I believe the Minister is deliberately leading the innocents of the Fianna Fáil Party along that line. So far as they are concerned they will follow. They do not switch off, because they are told by the President that they must go along a certain line. But I believe the people will not continue to go along that line. I believe the people will kick the Minister out of office before he is able to consummate the job. But, in the course of carrying this into operation, I apprehend that he will destroy the livelihood of certain individuals who depend upon their business operations for a living. I put it to the House that that is the general trend. But this Schedule is entirely inadequate to the form outlined in the Bill. We will have British companies with all their great wealth consolidated. We are going to have insolvent companies, in one way or another consolidated, and taken over, to enable them to carry on and to protect their policy-holders from loss. When they come under this scheme, every policy they issue will carry an implied Government guarantee.

The only persons left independent will be the solvent Irish companies, and they will be in this position: On the one hand, they will have as competitors the great British companies with their enormous reserves accumulated, offering far more advantageous terms than the Irish companies can offer. On the other hand, there will be the amalgamated Irish insolvent companies, issuing policies each of which is endorsed with an implied Government guarantee. Between these two competitors the independent Irish solvent firms will have nothing to offer. They cannot plead for business on the ground that they are Irish companies because the amalgamated companies will also be Irish companies.

It is not permissible at this stage to make a Second Reading speech. The Deputy has not yet related his remarks to any part of the Schedule.

I want to submit a form of Schedule for the one I am discussing. I was indicating the views to the Minister by which he might devise a scheme under which every company could claim admission as a right, instead of, as under this scheme, making every company submit to him a scheme. My contention is that the general trend of the Bill is that it forces every company either into bankruptcy or to amalgamate and, therefore, I contend that the duty devolves upon the Minister to devise an amalgamation scheme in which Irish companies could seek refuge. I am offering the Minister, in lieu of the proposals in the First Schedule, a standard amalgamation scheme into which no one would be forced to come except insolvent companies, and into which each one could come if it claimed to do so as a right. I, therefore, for the purpose of illustration, suggest that there may be in this country—I have no reason to believe that that is so—I am giving a pure illustration without any information on the facts— companies hopelessly insolvent, doing Irish insurance; and now I am submitting to the House the framework of an amalgamation scheme which I suggest should be adopted. I suggest company A which has, actuarially, a deficiency of £250,000; company B which has an actuarial deficiency of £100,000. I am suggesting a third company C as solvent and a fourth company D as solvent with a surplus, and a fifth company E with a greater surplus. I want the Minister to notify the company A that has an actuarial deficiency of £250,000 that he would take in exchange for the money he puts in ordinary shares to the value of £250,000. Let me assume that the actual subscribed capital is £20,000. That would give the Minister the vast majority of the shares and would make the company solvent. In regard to company B which has £100,000 deficiency I want the Minister to put in £100,000 in exchange for ordinary shares. That would make the company solvent and the Minister secure because the subscribed capital would then be in the neighbourhood of £100,000. Having done that, there would be five solvent companies, two owned by the Minister, and three by their own shareholders. The two owned by the Minister would be just solvent. One other would be solvent, and two others would be solvent and have surpluses. I then would have the Minister value these five companies actuarially and my submission is that a fair basis of valuation would be to show that the goodwill of a solvent company is commensurate with one year's premium income.

I submit, A Chinn Comhairle, that this is entirely out of order.

The question of the scheme of amalgamation was dealt with on Section 24, Part III of the Bill. The matter before the House is the Schedule of conditions affecting such amalgamation, but the Deputy is speaking of the general trend of the Bill.

The Deputy's own words were "the general trend of the Minister's policy" and "the general trend of this Bill." I assure him he will find, on referring to the Official Report, that I am quoting him correctly. He is proposing an alternative scheme of amalgamation, giving the basis of valuation and the value of the goodwill. Such matters are not relevant.

Sub-section (1) of the First Schedule says:

The memorandum and articles of association of every amalgamated company shall be subject to the approval of the Minister for Finance after consultation by him with the Minister.

(2) The memorandum of association of every amalgamated company shall provide:

And it goes on and provides certain things. I desire now to submit that the memorandum of every associated company shall provide certain things, and I want to go on and set out the certain things that the memorandum should provide.

The Deputy would possibly have been in order if he had submitted an amendment.

I do not want to. I want to submit a schedule and to provide for certain matters.

But the matters that the Deputy wants to submit must be relevant to this schedule.

I submit that these are matters that might be aimed at in connection with the amalgamation scheme and, therefore, would have come in under the general provisions of Section 24. The Schedule is associated only with paragraph (f), sub-section (2) of Section 24.

I desire to submit that the memorandum of association of the amalgamated companies shall provide for the basis of amalgamation and that the goodwill of the amalgamating companies shall be assessed on the basis of one year's premium income plus the amount of the actuarial surplus. The memorandum of every associated company, I suggest, should further provide that the ordinary shares will be issued to the joint value of the goodwill of the five companies plus the combined surplus.

Including shares for the goodwill of a company with a deficiency.

The Minister was not listening.

The Deputy said that two of the five companies would have deficiencies.

Not after the Minister had contributed money in exchange for shares.

We would have created the goodwill.

The Minister knows as much about the goodwill of an insurance company as I know about the Pharaohs of Egypt. I am putting forward a scheme now, and let his advisers tell him what it means. After I have finished he can go to his advisers and get them to explain it to him.

Nevertheless we are to issue shares for the goodwill of a company with a deficiency.

The Minister does not know what I am talking about. The memorandum of association having set out the value of the goodwill of the five companies, some of which are solvent, and some of which he would have been compelled to amalgamate, plus the value of the surplus, share capital to their joint value would be issued, and the five companies would be purchased from their present proprietors by the issue of shares to these proprietors in an amount equal to their several holdings in the five companies. That is to say that in respect of a company to which the Minister would have contributed £250,000 in order to make it solvent, taking 250,000 shares for the money contributed, whereas the capital is £25,000, the Minister would receive 1,000 shares in the amalgamated company for every one share the original proprietors of the insolvent company would receive. I think, Sir, the memorandum of association of the amalgamated company should provide that the directors of a solvent company would be entitled to compensation in the event of its being deemed expedient to dispense with their services as supernumerary in order to facilitate the amalgamation. I do not think that the memorandum of association of the amalgamated company should provide that a director of an insolvent company should be entitled to compensation inasmuch as by the failure of the company to maintain solvency he has disqualified himself.

I do not wish to interrupt the Deputy's argument unnecessarily. I do not remember clearly what should be in a company's memorandum or articles of association. It strikes me, however, that Deputy Dillon is including many extraneous and unusual items in order to discuss on the Schedule matters quite irrelevant thereto.

One of the most usual clauses in the memorandum of a company is a clause providing that the company shall have the right and obligation to confirm certain agreements that have been come to, which were necessary for the proper formation of the company. These are the matters to which Deputy Dillon has adverted.

Relevant to this schedule?

Yes. Matters that would appear either directly in the articles of association or would be contained in the scheme to be so confirmed.

Deputy Costello is quite right in stating that before the articles of association for the amalgamated company are prepared there must be a scheme, and the provisions of the scheme were discussed and settled on Section 24 of the Bill.

The question of amalgamation was fully discussed on Section 24 of Part III of the Bill.

I agree.

And may not now be reopened.

No, Sir. I have said that I regard the principle of amalgamation as having been decided, and I am now outlining a method—hateful as it is to me, I regard the principle of amalgamation as having been decided—by which there shall be incorporated in the articles of association or memorandum of association, whatever scheme of amalgamation is least objectionable.

The scheme of amalgamation should have been discussed on the relevant section.

At that juncture we were discussing the principle as to whether there should be amalgamation or not.

We discussed the scheme of amalgamation and assented to it.

On the original section we discussed whether there should be amalgamation or not and we disposed of that. It was decided against us, and for the Minister, that there should be amalgamation. We now come to the First Schedule and I am suggesting the contents of the articles of association of the amalgamated company. However, I do not wish to detain the House any longer than is necessary to state the details of the scheme which should be incorporated in the First Schedule. I trust the Minister will examine the suggestion I make. I trust he will realise my desire to have outlined appropriate contents for this memoranadum and these articles so as to prevent a memorandum being drawn, the effect of which would be to destroy an independent solvent company which is at present in existence. I believe there are at least three such companies threatened with extinction, if the memorandum of association of any amalgamated company is improperly or undesirably drawn. I should be glad to know if the Minister would consider having his Department draw a memorandum of association and articles of association into which he will invite all the companies to come on the terms outlined by me as highly desirable, in view, and only in view, of the success with which the Minister has secured the assent of this House to the principles which were raised at earlier stages in our discussion.

May I put the First Schedule?

Will the Minister give us any indication of his intentions?

I do not want to discuss the matter of amalgamation further than we have already done so on Section 24.

Is the Minister prepared to give us any indication whether he would consider providing an amalgamation scheme himself into which it would be open to any company that desired to enter without reference to whether it was solvent or not?

It is my hope that any amalgamation scheme that may result from this Bill will include within its scope companies which are unquestionably solvent.

But the Minister sees the point I am making. There are two schemes of amalgamation, one a voluntary scheme on the lines of the proposal which I have put before him. There are certain companies which he will have to order to amalgamate as insolvent. There may be one or two such companies; we do not know the number, but there are some. I want to know whether he will consider drafting a scheme, under which he would feel, within the powers already contained in the Bill, competent to order insolvent companies to enter on terms and into which he would feel himself free to invite solvent companies to come on stated terms to be fixed in each particular case by arbitration, actuarial arbitration.

The Bill provides for that at present.

The Bill provides for the Minister putting up a scheme himself?

That is the case I am putting to him.

Of course the Minister does not need a Bill to enable him to do that.

Surely it is desirable for the Minister to settle the public mind. Does the Minister feel free to say at this stage that he recognises he has a duty to discharge—as we all know he has—in respect to insolvent companies? Does he think it is practicable to put up a scheme which would attract not only the insolvent companies—he could force them in—but the solvent companies?

Possibly something on the lines I have outlined might commend itself to the Minister's Department.

I should not like to say that.

First and Second Schedules agreed to.

THIRD SCHEDULE.

I should like if the Minister would give us some explanation of sub-section (1), Section 1, of Part II of this Schedule.

On what point does the Deputy require information?

I should like to know what it means.

These are rules for ascertaining the amount of a free paid-up policy and the cash surrender value of any policy of industrial assurance.

I know that.

I do not know if the Deputy is merely trying to trap me. If he wants information, he will have to tell me what information he wants. The meaning of that paragraph is, I think, clear in relation to all the other paragraphs of that part of the Schedule.

I do not want to trap the Minister at all. I am asking for information on this particular sub-section and I think I am entitled to receive it. It is customary for Ministers, when dealing with a Bill in Committee, to explain each section. The Minister has not done that and has not been asked to do it. I am asking the Minister to explain sub-section (1) of Section 1 of Part II.

It means nothing except in relation to all the other paragraphs.

Does the Minister consider that that is an answer to my question?

It is. It means nothing except in relation to all the other paragraphs.

Am I to assume that the Minister does not know what it means or that he does not desire to give the information?

All these paragraphs constitute a set of rules for determining a certain thing and one paragraph, by itself, means nothing.

That is an answer?

The Minister must have in his papers a brief explaining this portion of Part II of the Third Schedule. Would he mind reading out that brief?

I have no intention of doing so. As a matter of fact, I have no brief. The meaning of Part II is quite clear. There are four paragraphs there which, between them, lay down rules for determining certain things. If Deputies desire to suggest alterations of these rules, I am prepared to consider them, but to say that they should be——

Explained. That is monstrous.

It is preposterous, because the explanation appears on the face of them. We say that certain things will have to be taken into account and certain calculations will have to be made in order to get a reasonable basis for determining the amount of a free paid-up policy or the cash surrender value of a policy, as the case may be. I am prepared to consider any alteration of these rules which Deputies suggest.

It appears to me that the Minister himself does not understand what the sub-section means. But the Minister is in a position of advantage as compared with other members of the House. He has experts at his disposal and we have not. I want to know what exactly is the meaning of the sub-section, which says: "... the date of the policy may be assumed for the purposes of this paragraph to be one year after the actual date thereof, and, if it is so assumed, duration of the policy may be assumed to be one year less than the actual duration". What does that convey to any ordinary layman without the assistance of experts? We are supposed to understand the legislation we are asked to pass, whether we do or not. We are entitled to ask for information. I am simply asking for information, and there is no use in the Minister getting angry or suggesting that anybody is trying to trap him. There is no use in his telling me that it means nothing.

It means nothing except in relation to the other sections.

Taken by itself, it means something definite.

The four paragraphs, between them, determine the rules for ascertaining the amount of a free paid-up policy or the cash surrender value of a policy.

Why is it thought necessary to put in the words "the policy may be assumed to be one year less than the actual duration"?

It is not thought necessary except that these combined rules determine the matter.

Why is that in this sub-section? It would not be there unless it were necessary.

We can discuss Part II of the Schedule as a whole and not portions of it.

We are discussing the Third Schedule to the Bill in Committee, and if I do not ask the question now the Ceann Comhairle will put the Schedule as a whole and there will be no opportunity for relevantly discussing this provision.

I have explained that the four rules in Part II of the Schedule provide a basis upon which the value of a free paid-up policy or the cash surrender value of a policy can be determined. Various modifications of each rule can be made, provided that the result represents a fair determination of the value of these policies. In this particular case we provide that the first year may not be taken into account, so as to allow a set-off against initial expenses, but some other device might have been adopted and the same result secured. The rules which we have taken and embodied in this Schedule are similar to those recommended by the Cohen Committee, the report of which Deputies opposite have frequently quoted in the course of this debate. The Cohen Committee dealt with conditions in Great Britain and made recommendations in relation to the conduct of insurance in Great Britain. In a matter of this kind it is merely a question of getting some fair basis, and this is as fair a basis as any other. Precisely the same result might be obtained by a completely different set of rules, and Deputies, if they so desired, could have moved to alter the rules which are set out.

I am not opposing this section. I merely want to understand it. I am not going to suggest any alteration until I know what the section means. The Minister has gone some distance by way of explanation.

This matter merely underlines the point I made to the Minister, not once, but 20 times—that if you are going to introduce complicated legislation of this kind you ought to circulate a White Paper in connection with it.

Enough White Papers and briefs were circulated to Deputies in connection with this Bill.

The Minister came in with a considerable bundle of papers under his arm, which it took two years to hatch out under the comfortable wing of every British insurance company which has invaded this country. What I am suggesting is that when complex legislation of a highly technical kind is brought before the House it would greatly expedite the discussion if the Minister's expert advisers would prepare a simple commentary on the more highly technical schedules and sections of the Bill, a commentary which would explain the general trend and purpose of the sections. That is the universal practice in the House of Commons, in the United States House of Representatives and in the United States Senate, and in my opinion it is a practice that would be a very desirable one in this country, particularly now when we have here a mono-cameral Government.

Schedules 3 and 4 agreed to.
FIFTH SCHEDULE.

Is this Schedule going to be reviewed in connection with the intending review of Section 84 of the Bill?

Well, the Minister himself, so far as Section 84 of the Bill is concerned, felt that that section did not clearly express the purpose the Government had in mind.

On the contrary, I think it does clearly express what the Government had in mind, but so that it shall be still further clarified I have agreed to accept certain amendments which appeared on the paper from Deputy Costello and to embody them in the section, not because I consider that these amendments are necessary or that a change in the section will be effected, but because it is desirable to have clarification. That, however, has nothing to do with this Schedule.

All I want to ensure is that the Minister will do what he expressed his intention of doing when speaking on this Bill on the 10th June, 1936, as reported in column 2275 of Vol. 63, No. 5, when he accepted Deputy Costello's amendments in principle.

I would be surprised if I said that.

What happened was that on that occasion Deputy Costello said:

"I accept, of course, his statement that his idea is that this reinsurance company should operate on the same business lines as ordinary reinsurance companies do at the present moment."

To that my reply was:—

"That is intended, but a reinsurance treaty at the present time between one company and another is a voluntary arrangement. To a certain extent that voluntary arrangement is being removed from the relations between companies licensed to do business here and the reinsurance company of Ireland, because it says that there shall be an agreement. In these circumstances I think it is necessary to have the qualification to which the Deputy refers which is designed to prevent a company, having a reinsurance agreement with the reinsurance company, writing all sorts of bad risks, passing the whole of these risks on to the reinsurance company and retaining none itself. The object of this provision is to ensure that this cannot happen ..."

I think the quotation the Deputy wants is in column 2273.

Yes, in column 2273 the Minister said:—

"I am quite prepared to agree to ... Deputy Costello's amendment which, I think, is intended to clarify the intention of the section and which would clarify it in my opinion if inserted."

That does not affect the Fifth Schedule at all.

Fifth Schedule agreed to.

SIXTH SCHEDULE.

On behalf of Deputy Costello I move amendment No. 187:—

In pages 55 and 56 to delete the words—"(i) Third Party Claims, (ii) All other Claims"—wherever they appear.

The object of this amendment is to simplify the form of the Schedule. Presumably the object of returning the fund in that form is to be found in Section 94 of the Bill, sub-section (1) of which sets out the nature of the returns to be made and sub-section (2) of which describes the form of this Schedule. Under the first sub-section the assurance company carrying on the business of insuring mechanically propelled vehicles is required in addition to the statement made under Section 76 of the Road Traffic Act to prepare a statement of the estimated liability of such assurance company in respect of outstanding and unsettled claims relating to such business. The object of the section is to ensure that the company are making proper provision in respect of outstanding and unsettled liabilities. There is nothing to suggest that anything can be gained by dividing the return into two classes of claims, first, third party claims and, second, all other claims. The amendment is that that division should be eliminated and that the returns asked for should merely be sufficient to satisfy the requirements of the section. It is obvious that the division asked for in the Schedule cannot be made with any sense of reality. No doubt it is possible for the company to say how much it has paid in respect of third party claims within the year, and how much in connection with mechanically propelled vehicles. But by requiring a severance of the particulars between the third party claims and the other claims, the Bill is asking for something that can be done. The object of the section will be fully satisfied by requiring a return to be made in respect of claims in connection with mechanically propelled vehicles. There is no real purpose to be served by requiring this severance of the different claims. Insisting on this severance will mean that costs must be incurred in regard to the claims as a whole. Ordinarily the claim in respect of this insurance would include the third party claims and the material damage claim in respect of the car.

In support of what Deputy Lavery has said I think the Minister will realise that in a number of cases the settlement really does not give the assurance companies the information that is asked for under this. It is a lump sum settlement. Really asking for the breaking up of this third party and other claims would be at the best only an estimate. I think what the Minister wants to know is the total liabilities of the insurance company.

I am disposed to agree with Deputy Lavery, but Deputy Costello's amendment goes much further than what he said. I am prepared to bring forward an amendment on the Report Stage making it clear that the amounts need not be segregated in respect of costs and expenses as between the third party and the other claims, and also proposing that all the claims arising out of one policy may be treated as one claim.

That the third party claim and all the other claims arising out of one policy will be treated under one head. If I knock down a man and injure him that is a third party claim. Then there is a claim for the injury to my car. Will all be treated together as one?

What is the purpose of requiring this division?

I propose to insert an amendment not to require a division in respect of costs and expenses. I doubt that there will be any difficulty in regard to giving information except where claims under various heads arise out of one policy. In that case we will not require a separation.

What are you proposing to do?

I will bring forward an amendment at the next stage to clarify these matters.

Does the Minister suggest that at present there is no difficulty in separating these claims?

If the Minister is prepared to accept the suggestion about bracketing third party and all other claims together, I understand that is all Deputy Costello wants to achieve.

I propose to put a note into the Schedule making it clear that the segregation of costs and expenses as between these two groups need not be effected.

Will the Minister tell us, in reply to Deputy Lavery's query, what purpose is to be served by making this segregation? If you have an accident of a mixed character in which a third party is injured, and your vehicle is at the same time destroyed and the two risks are covered by the one policy, how will such a claim be segregated?

I propose to introduce an amendment requiring them not to be segregated.

Where will you put them, under third party or under the other?

I suggest the Deputy might wait until he sees the amendment.

Amendment No. 187, by leave, withdrawn.
Notice taken that 20 Deputies were not present; House counted and 20 Deputies being present,
Sixth Schedule agreed to.
Bill reported with amendments. Report Stage fixed for Tuesday, 7th July.
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