I move that the Bill be now read a Second Time. As members of the previous Dáil are aware, this Bill was introduced early in the year and was considered here both on Second Reading and in Committee. It was wiped out by the dissolution of the Dáil and has to be reintroduced. For the information of Deputies who were not in the last Dáil, I may mention that it is a Bill to establish new machinery for the control of the industrial alcohol undertaking. The question of whether that undertaking should or should not have been started, or how it is conducted, probably does not arise on the Bill. The only question that does arise is whether it was better to have the undertaking which is there controlled by a committee from the Department of Industry and Commerce or by a company set up for that purpose. We think it is better to have the company procedure, which has worked successfully in the case of the sugar enterprise, the Electricity Supply Board, and other activities of that kind. In fact, experience has shown that the operation of an industrial concern of any kind through the Minister for Industry and Commerce, the Minister acting, as he must act, through an advisory board, is not a satisfactory arrangement and, consequently, this change is proposed.
Committee on Finance. - Industrial Alcohol (No. 2) Bill, 1938—Second Stage.
I think we could discuss the desirability of continuing the industrial alcohol undertaking quite relevantly within the meaning of the Bill, but our position is that we are resolutely and convincedly opposed to the whole experiment. We think it is a gross waste of money, great foolishness, and must eventually end in a smash in which a lot of money will be lost, a lot of time wasted, and a good deal of damage done. But we divided on this in the last Parliament, it has gone before the country, a decision has been taken in the country on it, and for that reason we do not propose to divide on it to-day. Not that we have changed our minds by a hair's breadth, because we are convinced that the whole thing is an economic cod from beginning to end, and we are convinced that the Minister knows that as well as we do, but he is now engaged in a face-saving operation. The sensible thing would be to wind up this whole nonsense, close up these ridiculous factories, sell the machinery for scrap, and get out as best you can. That would be the courageous thing to do and the right thing, and I believe the Minister knows that as well as we do. The Minister told us he was going to provide a market for potatoes at £2 per ton. Deputy Moore is quite distressed because the farmers want £2 a ton for potatoes when the Poles are prepared to produce them for 15/-.
The Deputy is good at misrepresentation.
I did not say that the Deputy asked the Minister to give our farmers no more than 15/-. He did not say that. All he said was that his information was that the farmers of Poland were glad to produce potatoes at 15/-.
I did not even say "were glad." I recorded a fact which I can prove.
The relevance of the observation, I suppose, depended upon the implied suggestion that our farmers ought to be very grateful for getting £2 when the Poles are only getting 15/-. Personally I would not take £2 for a ton of potatoes if you gave them away with pounds of tea.
As I told the Deputy, some of his best supporters in the country would be glad to produce them at 30/- if they got an alcohol factory.
Let us be clear that if they make that offer they mean they are going to deliver potatoes at the factory at 30/- per ton. The average freightage is going to be 8/-, and the Minister's scheme to deal with beet is 30/- a ton at the factory.
No one has to take that. No one is compelled to sell potatoes if they do not like to do so.
I agree, and I take great consolation from the fact that four years ago they would have to take it and lump it. Now they can just laugh when it is offered to them, but that effort to laugh will cost the taxpayers about £10. Although I like to see farmers laughing as well as anyone else, I think £10 a laugh is too expensive. Deputy Moore pointed out on a previous occasion that he found me unreasonable in opposing this scheme, and said he was in a position to show that Germany, France, America and a number of other countries were producing industrial alcohol. He asked why should we not do so. I never heard anyone advance any valid reason why we should produce industrial alcohol. To tell the truth, I was at a loss at first to imagine why any country would want to produce industrial alcohol. I begged the Minister to tell me the reason, but he would not do so. Then I found out, the fact being that the industrial alcohol business was founded on the coincidental existence of two factors, one being the presence of large quantities of the by-products of some other economic industry, which would have to be jettisoned if not converted into industrial alcohol, and, side by side with that, a demand by other industries in the State for a spirit other than petroleum. A number of industrial processes required some spirit, other than petroleum, so they had to make it up from whiskey, brandy or gin. As alcohol could be derived from inexpensive by-products, these by-products were molasses from the sugar industry. But no rational person would have suggested the establishment of industries, even from these worthless by-products of the sugar industry, which were going to be dumped into the Atlantic Ocean if not used for conversion into industrial alcohol. No one would suggest such a use of worthless commodities for alcohol when petrol could be used instead. The only reason for setting up refineries to convert this worthless raw material into alcohol was because they were obliged to choose between that stuff and what would be more expensive, and that is alcohol distilled from grain. Therefore, the foundation of the industry was the existence of worthless raw material about to be jettisoned.
The Deputy should have regard to the facts with regard to the industry in Great Britain, where they are importing molasses. They would not get molasses from the sugar factories because they are too valuable.
The alternative was to buy whiskey, gin or brandy and to distil that into alcohol suitable for industrial purposes. That would be an immensely expensive article, and was, in fact, for many years used in industrial alcohol operations of that kind. It was the presence of cheap molasses, which were, in fact, habitually thrown into the sea in order to get rid of them, that made it possible to establish the industrial alcohol business. The reason molasses are carried from Trinidad and Cuba to England for conversion into industrial alcohol is because it is cheaper to produce industrial alcohol out of molasses carried from the ends of the world than from potatoes. Is not that so? Is not that the reason for bringing over molasses in tankers from the far ends of the world, that they can produce industrial alcohol cheaper, even after ferrying them across the Atlantic, than they could if they got them from distilleries?
Can the Deputy say why they do not get molasses from the sugar factories in England?
I suppose they do.
They do not. It is too expensive to buy them.
This insane Government that we have, having discovered that the beet sugar industry is grossly uneconomic and ridiculous, but that there were by-products, are establishing factories to deal with these by-products, at a cost of £1,000,000 a year, despite the fact that the molasses from the beet-sugar factories in Great Britain are too expensive and can be got cheaper from Cuba or Trinidad. With that example, we are to spend £1,000,000 a year in developing an industry and that was described as a grotesque procedure. The astonishing fact is that Deputy Moore is quite incapable of adding two and two together without having a plus.
The Deputy, having wrestled with himself for a quarter of an hour, has at least nearly knocked himself out.
Not at all. I put it to the Minister that in other countries factories were set up because there were available quantities of raw material, which would be thrown into the Atlantic Ocean if not converted into industrial alcohol. In this country we are setting up factories and growing crops to feed these factories and to keep them in business, or is it because the Minister is going to start importing molasses from Trinidad? If the intention is to import molasses from Cuba, will that justify the expenditure of £175,000 on these molasses for conversion into industrial spirit in factories that will, in fact, employ 200 men?
It will not cost that.
It will.
Not if we used imported molasses.
I am only going by what the Minister said, and he seems to take a diabolical interest in it.
I submit that the Deputy is now dealing with the general merits of industrial alcohol.
Which is a perfectly legitimate thing to do under the Bill.
Whether the Bill is opposed or not it will not be altered.
The Minister should have the moral courage to blow up the whole thing and save the money.
The Deputy made a speech to that effect.
I said in my constituency that if they were going to start industrial alcohol factories there my advice was to elect a Government that would blow them up.
The Deputy must be seeing double. We have only one there.
There are two factories.
One is in Cooley, which is not in the Deputy's constituency.
I never hesitated to tell the people that my policy in regard to them was to blow them up, and to spend the money on some more useful purpose — to spend it on agriculture. My advice to the Government is to dismantle the factories, sell the machinery for what can be got for it, and then blow them up. That is the sensible thing to do. That is the economic thing to do. That is the best method of benefiting agriculture in so far as this Bill is concerned, and I will promise you this, if you will give us an undertaking that, having established Monarchán Alcoil na hEireann, Teo., your first instructions will be to buy 6 cwt. of dynamite and blow the whole six factories to blazes and sell the machinery for scrap, we will give this Bill a cordial endorsement, and it will be the best day's work you could do for the country if you blow the whole shooting match to blazes and save the money you are going to waste on it. And the Minister knows it. No man knows that better at the present moment than the Minister, and what puzzles me is why he has not the moral courage to say, "I have made a mistake over this. I thought it was useful and worth trying. I find in practice the whole thing is a gigantic cod. Give me the price of 6 cwt. of dynamite and I will remove this out of your way for the rest of time!" If you do that, you will have the unanimous support of the House, and you will be doing the first useful thing you have ever done for the economic life of this country, and that is to blow up one of your follies.
I know very little about industrial alcohol. As a matter of fact, I know very little about alcohol of any kind. But I know a good deal about potatoes and the growing of potatoes, and because I know something about potatoes I am very interested in this Bill, although it does not, I must say, concern the constituency which I represent. I believe that if I were to study the question from the point of view of gaining popular support I would be inclined to oppose this Bill, but I feel that it is the duty of representatives of the people here to study every question that comes before us from the point of view of what is in the best national interests. Viewing this question from that point of view, I am at a considerable disadvantage, because the Minister for Industry and Commerce has not stated exactly what his case is in support of this Bill.
He has not any.
To my mind, so far as I can judge, the main arguments that can be advanced in support of this Bill are, first, that it provides a means of getting rid of certain of our surplus potatoes; secondly, that it may provide an industrial fuel in face of a national emergency.
As far as I can judge, the first argument in support of this factory is not altogether as sound as some people might imagine. I believe that there is or that there should be some other means of disposing of our surplus potato crop besides converting them into industrial alcohol. I believe that there should be and that there is in certain Continental countries a system under which the surplus potato crop or a substantial portion of the potato crop is converted into concentrated food for live stock. I think that a scheme on those lines would be more advantageous to the country than the scheme for converting potatoes into industrial alcohol. But, in regard to the second argument, I believe that there is a certain amount of ground for it. I believe that it is the duty of every independent nation to take such steps as may be necessary to make itself self-sufficient in commodities which are absolutely essential, and I think motor fuel is an absolutely essential commodity. Therefore, for this reason, and for this reason alone, I am prepared to support this Bill. I feel, however, that the Minister should keep in view the fact that there may be alternative methods of disposing of the surplus potato crop, and I believe that the Minister should also keep in view that it is desirable in the national interests, in the interests of relieving unemployment and in the interests of promoting increased agricultural output to promote an increase in the acreage under the potato crop. But the Government should direct their attention to having that increase utilised mainly as a substitute for imported feeding stuffs. That is my view of the matter, and I think that in considering the development of those industrial alcohol factories the Minister should be guided by that consideration and he should not seek to extend the development of those factories to any great extent but should retain them merely as a safeguard in case this country is cut away from our external supplies of motor fuel or of such supplies being restricted in any way.
Before we reach the Committee Stage of this Bill there are a few things I would like to know. As I interpret this Bill the new company is purely to be a committee under the Department of Industry and Commerce and, as the State is going to guarantee everything it does, and the entire cost of this stock and all the money involved in the undertaking, I would like to know if the technical staff are going to be permanently employed whether or not any potatoes are supplied to these factories during any given period, and if the managing director is going to be paid permanently. Assuming that no potatoes are received in the factory and that no alcohol is turned out, are you going to pay these salaries? Is that going to be part of the scheme? Simply because the State is security, are these men going to receive these substantial wages — they are salaries, not wages. Are they to be paid irrespective of whether they earn the money or not and whether the factories earn the money or not. The whole scheme strikes me as being uneconomic; that these men should be employed, master distillers, assistant distillers, technical staff should be there and paid simply because the State is a guarantor, and the State is the milch cow for this purpose. I would like to know the financial construction of this thing. What is meant by all this thing?
Apparently in the Bill the State is to guarantee all the money and all the expenditure in the running of these factories. I would like to know also if there will be any organisation and co-ordination in the management in connection with the transferring of technical staff from one to the other. During a period of unemployment in one factory, if a man is not wanted, will he be spared to another in order to save costs, or is a master distiller and an assistant distiller employed at each distillery to remain there during the year, or is there one master distiller that will be responsible for the entire five factories, having control of them and giving direction, in order to save cost? What scheme of economy is there with regard to the internal working of all the factories, or is it that they are all working as separate units independently of one another, each one having its own separate overhead charges and separate staff under the one managing director? I would like to know these things before the Committee Stage is reached.
Before the Minister replies I would like to ask if he has included the amendments that were put in on Committee.
Yes, they are all included. I do not think it is necessary at this stage to enter into any elaborate defence of the Government's decision to establish these factories and go ahead with this scheme. That matter has been discussed very frequently here in the House on various occasions, and there seems no greater prospect of our being able to convince Deputy Dillon and his colleagues of the wisdom of our decision now than there was then. We obviously did not succeed in convincing them in the past, but I think we were fully justified in the circumstances of 1934 in having decided upon this development and we are fully justified in maintaining it now, even though the circumstances now existing are very different to those of 1934.
It is not possible, of course, except at considerable wasteful expenditure, to do what Deputy Cogan suggests, and that is to establish these factories and merely keep them there for utilisation in times of emergency when it might be necessary to supplement the supplies of motor fuel that could be imported. An industry of this kind, which is of a highly technical nature, requires not merely factories, but also trained personnel to operate them, and that trained personnel could not be made available at short notice. In any event, as I explained before, there are many useful purposes to be served by the operation of these concerns. Not merely are they of very considerable benefit to the parts of the country in which the factories are located — and Deputies are, no doubt, aware that special considerations operate in respect of some of those localities — but also they make possible the provision here of a motor fuel of a special quality.
It is, I think, not generally appreciated that the mixture of industrial alcohol and petrol and benzol constitutes a very high-grade motor fuel, which is sold on its merits in other countries in competition with petrol, and the sales of it are substantially increasing, because people regard it as a superior fuel. Apart from the use of industrial alcohol as a fuel, its use in other industrial processes is increasing. It is one of the essential raw materials which our country should endeavour to provide itself with, so that its ordinary life would be carried on in circumstances of emergency against which, unfortunately, all countries must plan at the present time.
Those are all matters which were discussed on many occasions since the scheme was originally devised. I am not, of course, disputing the right of Deputies to discuss any matter affecting the scheme. The reason for the introduction of the Bill is because the Government have decided to transfer control of the enterprise from the Minister for Industry and Commerce to a company to be established. At the present time the enterprise is conducted by the Minister. He has the benefit of the advice of an advisory board. Everything is done in his name and his formal assent must be secured to any proposal involving expenditure or any major matter affecting the enterprise. The Minister is, of course, a public officer and the operations of his Department in relation to industrial alcohol are subject to the same checks in regard to financial matters, and the same supervision by the Comptroller and Auditor-General, as are its operations in relation to any other matter and no industrial enterprise can be run successfully by a Government Department controlled and limited in its operations in that way. That is why we have decided that this enterprise, now that it has reached the stage where a full year's operation can be contemplated during the coming season, should be transferred to a company which will operate as any other private company will. That company will operate in precisely the same way as any other privately-owned company. The only difference is that the shares in the company will be owned by the Minister for Finance and not by members of the public.
I could not answer Deputy McMenamin's hypothetical questions. It is not contemplated that these factories will be idle or that a staff will be maintained doing nothing. It is contemplated that the factories will be worked to the maximum extent possible and that the staff will be fully occupied in their labours in that regard. There is only one managing director. The five factories will be run as part of one scheme by the company, but there will be, of course, separate arrangements for the supervision and operation at each individual plant, as is obviously necessary.
There will be a distinctly separate staff for each distillery, including a master distiller?
Of course. They are distinctly separate concerns, but the general management questions are all determined by the managing director.
But we vote the money.
You are not voting any money at the moment. This Bill merely establishes a company with capital, and transfers to that company the assets already there.
And we guarantee all the losses.
The company is established with a capital which is ample to enable it to carry on the enterprise. Most of that capital will be transferred in the form of fixed assets, not in the form of cash. If they require capital over and above that already provided, they will undoubtedly get it under a Government guarantee.
A blank cheque?
There will be no loss in the sense that the Deputy seems to contemplate. We have demonstrated, and it is beyond question, that we can produce industrial alcohol. That will be sold——
At what price?
At 3/- a gallon.
And the petrol costs 4d.
The Minister must realise that is nonsense.
There cannot be a loss, because we can compel the people to buy it. The Deputy may speak like that; he can discuss that if he likes, whether we should have that power. In any event, there cannot be a loss.
Buy the dynamite.
If the Deputy would undertake to sit on top of one of the buildings when I am using it, it would be worth it.
I would be almost inclined to make the sacrifice.
In the case of molasses, is it the intention of the Minister to divert the molasses from the sugar beet factories?
No.
We were told by Deputy Moore that molasses are a very valuable product. I know something about molasses and they have very little or no food value, but they are added to sugar beet pulp to make it palatable for live stock. I know that during the negotiations to fix the price of sugar beet this year an attempt was made to ask the farmers to take untreated sugar beet pulp, that is, pulp without molasses. The molasses are added to sweeten the pulp and to make it palatable. I rather gathered that it was the intention of the Government, when the farmer was asked to take the sugar beet pulp untreated, to divert the molasses.
We are installing plant for the utilisation of molasses in the alcohol factories, and any molasses the sugar company chooses to sell for that purpose will be utilised. That is a matter of policy for the sugar company.
An attempt was made by the sugar company almost to compel the farmers to take untreated pulp.
They might be entitled to do it if it were considered good policy, but that has nothing whatever to do with me.
Is the Second Stage agreed?
Reluctantly.
Question agreed to.
Bill read a Second Time.
Committee Stage fixed for Wednesday, 13th July.
Will the remaining Estimates on the Order Paper be taken on next Wednesday?
I think so. So far as I know, it is the intention to take them on Wednesday.
The Dáil rose at 2 p.m. until 3 p.m. on Wednesday, 13th July.