I move that the Bill be now read a Second Time. This Bill is intended to give legal sanction to measures already taken by county councils to provide seeds and fertilisers on loan terms for cultivators who are unable to provide them in the ordinary way out of their own resources. The continuance of emergency conditions makes it desirable that a Bill of this sort should be in operation, and it is necessary to legalise the measures which have been taken already by local authorities to provide seeds and fertilisers. Under the Bill, the county councils can exercise their powers in two ways: they can sell seed on loan terms, provided by Section 3 of the Bill, or they can give guarantees to seed merchants, under Section 5. The Bill is in similar terms to the measures which were passed last year with the exception that this year there is an additional provision, contained in Section 6, respecting the partial recoupment by the Minister for Finance of losses, which have been unavoidably—if I might put it that way sustained by the county councils in the operation of the Bill. The total amount to be provided by the Exchequer under this section is limited to £25,000 and is to be allocated in accordance with the terms set out in the Bill.
Seeds and Fertilisers Supply Bill, 1942—Second Stage.
I take it that the operative power in this Bill is Section 3?
Sections 3 and 5.
Under Section 3 it would appear that the county council, having got a certain number of individuals to buy their seeds and fertilisers, may review the whole proceeding, and if it should transpire that the sales to these persons were at a cost below the inclusive cost to the county council of all the seeds or fertilisers, they are empowered to apply to each person who has purchased seeds or fertilisers for the extra sum involved. If I read that section correctly, it appears to me that that is the intention and, speaking as a person who has had some experience of business and who knows the objections that people have to the State or a local authority getting greater power than a person in business has, I would say that that is an objectionable intrusion. It is a retrospective charge, and if that is the intention, it seems to me to be a strange procedure. There is no earthly reason why either the State or a local authority, in parting with goods, should not have the correct price marked on the goods they are marketing and ensure from the commencement that there will be no loss. The Minister knows quite well that if one were to sell seeds to a person in February or March or even in October or November, and within 12 months were to send a further account to that person, it would give rise to very grave dissatisfaction. I think that the section ought to be reconsidered.
The purpose of the section is to enable sales to be made on credit. The section provides:—
(1) Whenever the council of a county has, during the period to which this Act applies, provided a supply of seeds and fertilisers or of seeds only or of fertilisers only for distribution in such county or in any particular portion thereof, it shall be lawful for such council to sell any of the seeds and fertilisers or seeds or fertilisers (as the case may be) so provided to any occupier or cultivator...
(2) Whenever the council of a county has, in the period to which this Act applies, provided and sold under this Act seeds and fertilisers or either of them, such council may ascertain the total amount of the costs and expenses (other than the price paid by such council for such seeds and fertilisers or seeds or fertilisers, as the case may be) incurred by such council in respect of the provision and all sales of such goods in that period and may apportion such amount amongst the several persons to whom such goods were so sold in the said period...
The purpose, of course, as far as it can be secured, is to sell the seeds at what they cost the council. This provision is drafted in this way to enable a person who, in the first instance, is not able to purchase seeds immediately or to pay cash for, to obtain them wherever they can be obtained in present circumstances, and then to have the expenses incurred in working the scheme allocated over everybody who has benefited under the scheme.
How will the section be operated? Will the price be fixed in the first instance, or will the purchaser not know what the price is until the demand for payment is made on him.
I take it that the seeds will be purchased in the ordinary way from the seed merchants, and that a purchaser will then be told what they are going to cost him. He will know that in advance, but, on top of that, there will have to be added his share of whatever the overhead expenses may be.
Will the expenses include bad debts?
No, because the county council itself is supposed to bear its own bad debts less 50 per cent. up to the overriding figure which is set out in the Schedule.
The way that the ordinary man in the country looks upon this scheme is that he has to look for a so-called loan which he does not get. If the seeds are supplied to him by a local merchant he has to get some local person to go security for him to ensure that they will be paid for. I think that explains why the scheme is not being availed of to a larger extent. In connection with these seeds and manures the purchaser has to get, as I have said, a local person to go security for him. The local authority does nothing except to guarantee the seed merchant the cost of the seeds and manures. The purchaser has to pay the ordinary price for the seeds and manures. This provision of compelling the recipient of them to provide security for their payment acts as a great deterrent, and explains why so comparatively few people avail of this scheme. I wonder if the Minister could do anything to improve that position. After all, there are many people who want these seeds and manures, and in these times it may not be easy for them to get neighbours or others to go security for them. The security is required in order to recoup the county council against loss.
In connection with this Bill, which now comes annually before the House, the members of this Party have always availed of the opportunity which it presents of pointing out to the Government that in their opinion the scheme in operation is not sufficient to meet the requirements of the agricultural industry, or to deal with the type of credit that is required. I want to avail myself of this opportunity again to point out to the Government that in this time of emergency this scheme is altogether inadequate to meet present requirements. Farmers are expected to till 25 per cent. of their arable land. That, as Deputies know, involves a very considerable amount of capital expenditure. Very few of our people are in a position to-day to provide the capital involved in carrying out that amount of tillage. The Minister must realise that the advances that are being made under this scheme are relatively small, and that the people who usually avail of them are the smaller type of farmer and cottier.
We have always insisted that what is required is a scheme to cover a different type of man altogether. I think that one of the reasons why this scheme is not being availed of to a larger extent is the amount of publicity involved. That tends to keep back many people, who otherwise would do so, from making applications. It is hardly fair to throw on the local authority the responsibility for financing a scheme of this sort. Undoubtedly, you have a number of people who are not prepared to have their cases submitted to the sort of public examination which is involved when an application under the scheme is sent in, because it means bringing a man's private affairs before 20, 30 or 40 members of the local authority. It means that a man is making application for credit and that all his neighbours will know about it. We know that our people are a proud people, and that many of them are not prepared to have it said among their neighbours that they are looking for credit.
I do not think that is the proper way to operate a scheme of this kind. People do not like asking their neighbours to go security for them. Some other method, I think, should be adopted of providing credit for farmers during this time of emergency— through the joint stock banks or some other source—to enable them to meet the very substantial capital outlay that is involved in carrying out the extra tillage operations.
The Minister must appreciate that a man who has not been tilling to any extent has to provide the equipment and buy the necessary seeds and fertilisers, if there are any to be had. If an examination is made into the capital commitments necessary to carry out the Compulsory Tillage Order the Minister will appreciate the necessity that arises in a great many cases for the provision of considerable credit. This type of Bill does not help that sort of person at all. In fact, it is only a very small credit advance that is covered by a Bill of this sort. Coupled with that, as I said, you have the fact that many of our people, because they are proud people, are not prepared to have their private affairs submitted to examination by a public body.
I think the principle of the Bill is all wrong. If the Government are anxious to provide credit, it ought to be provided in a totally different way altogether. Certainly it is unfair and unreasonable to expect a man to make an application and have his whole case submitted to public examination and his affairs discussed and talked about, particularly by his neighbours. A great many people will try to raise the money privately before they will submit to that sort of thing. That is the reason why the operation of this seed and fertiliser scheme has been a failure. If the amount of help and assistance afforded by it is to be gauged by the amount of advances made by the different counties, you must come to the conclusion that the operation of the scheme has been an absolute failure, and while it is operated as at present it will continue to be a failure.
One of the reasons, in my opinion, why we have had such tremendous difficulty in making the Compulsory Tillage Order a success as compared with Great Britain, Northern Ireland and other places, is that we have not given that attention to credit and other details which is necessary if its operation is to be a success. This is merely an excuse. It is not in fact making any attempt to provide the sort of credit that is essential at present. I suggest that the Minister should reconsider this whole matter. It is probably too late to do that this year. But this emergency is likely to continue for a considerable period, and I think the Minister and the Government ought to consider a different type of provision altogether, some sort of provision which will be really useful and of which the people will be prepared to take advantage. As I say, this simply covers very small sums. Again, I think it is unfair to throw the responsibility of providing credit facilities on the local authorities. It is not really their job. I would therefore appeal to the Minister to have this whole matter considered in the light of that consideration. Very substantial sums by way of credit are essential if our campaign for increased food production is to be a success. Certainly you can never make it a real success or provide sufficient credit on the lines of this Bill.
I feel that this Bill is merely tinkering with a very big problem and that it is not the Minister for Local Government who should be introducing a measure of this kind. It is a matter which has to do with agricultural production and it should be the duty of the Minister for Agriculture to make all the necessary arrangements in regard to the financing of increased agricultural production. There are probably no bodies in this country with such slender financial resources at their disposal as the county councils. From one end of the year to the other it is an intense struggle on their part to make ends meet or to make their accounts balance. Their supreme consideration is to avoid having their liabilities increased or having to increase the burden of local taxation upon the ratepayers. For that reason no local authority can accept a measure of this kind and the liabilities which it involves with enthusiasm. The result is that when a county council is called upon to formulate a scheme the natural tendency is to limit the extent of the scheme as far as possible so as to avoid incurring heavy liabilities. In many counties the average amount of loan granted does not exceed £10. For the average farmer who engages in wheat growing £10 is of very little use. It will only seed three or four acres. For that reason the scheme is one of very limited value. I understand that there is provision in this Bill for recouping the county councils to a very limited extent.
Fifty per cent. That is not a very limited extent.
To the extent of 50 per cent., but the amount for which the State will accept liability is very considerably limited. I notice that in County Carlow the total amount of liability which the State will accept is £335 and in County Wicklow £507. I do not think that a scheme limited to that extent can be of any far-reaching value. In promoting increased tillage you have many things to consider besides seeds and fertilisers. In many cases farmers require credit in order to procure the necessary equipment and for the provision of equipment a scheme of this kind would be absolutely useless. If a scheme for the provision of the necessary equipment were to be visualised it would be a very far-reaching one and would not only have to provide long-term credit but also some security that the price of produce would remain stable and economic for a period exceeding the period of the emergency. That would be a matter altogether outside the scope of the Local Government Department or the county councils.
Or of this Bill.
Or of this Bill. I just want to mention that this Bill does not deal with the problem with which it purports to deal, because when we talk of credit for farmers we are immediately met with the answer that there is a seeds and fertilisers scheme which provides ample credit for farmers. I want to assert that this measure does not provide anything like adequate or ample credit for the development of increased production. As Deputy Hughes pointed out, we also have the publicity involved in having applications dealt with by a local authority on which there are local representatives whom the average applicant might not wish to have investigating his financial affairs. There is also the disadvantage of having to secure very substantial security.
I do not think that that provision is altogether necessary. I think that some alternative might be found, such as a recommendation by the local rate collector, who would be the person best qualified to judge the character and finances of the applicant. The local rate collector is the person who would subsequently have to collect the repayments, and I think a recommendation from him would be the best way out of the difficulty, instead of having to drag in two or three of the applicant's neighbours. The Bill does not meet the situation, and I think something more in keeping with the needs of the situation will have to be thought out immediately. In the matter of credit, it might be well for the Minister to consider what is being done and has been done for the past 15 years by the Irish Sugar Company, which not only provides growers with seeds and manures, but also provides a loan——
And also has a lien on the crop.
The sugar company, of course, has control over the marketing of the crop, and I believe that the average farmer would prefer to offer the same security as the beet growers offer in exchange for a similar advance. I think that, if some provision were made by which the farmer would guarantee to sell the crop to a certain appointed agent, in consideration for having secured an advance for his seeds and manures and to enable him to harvest the crop, it would be a much better solution of the problem, and would be more attractive to the average farmer than having to seek sureties from amongst his neighbours, and have all the publicity of having his case investigated by a locally elected body.
I think the purpose of this Bill has been misunderstood both by Deputy Hughes and Deputy Cogan. It is not a Bill to provide agricultural credit in the broad general sense of that term. If it were, it would not have been introduced by the Minister for Local Government. This is an enabling Bill; it is a Bill which is designed to permit county councils to provide credit for people who might be described as purely and simply subsistence farmers, people who have a little patch of land, and who want to put in a crop to feed themselves in the first instance, and, if they have any surplus, which is perhaps unusual, to dispose of that surplus.
The mere consideration of the fact that, in general, the seeds and fertilisers are provided for the purpose of growing food for the household rather than food for sale would show how impracticable is Deputy Cogan's suggestion that the farmer, the man who borrows £6, £10, or £15 as sometimes is the case under this legislation, should give the county council a lien on the crop, or that this would be a better way of securing the county councils and the local ratepayers against loss than the method which is proposed in the Bill. As I said, to that extent Deputy Cogan has misunderstood the purpose of the Bill.
A great deal has been said about the delicacy of farmers in a matter of this sort. We have been told that the provisions of the Act are being nullified by reason of the fact that people do not want to disclose their position when they seek a loan. Naturally, that is human and understandable, but are we going to make the position such that any man who wants a loan, which his neighbours as ratepayers have to guarantee to pay, can go and negotiate that transaction behind the backs of his neighbours? What would happen if we did would be that any number of people who did not in fact require the assistance provided under this Bill would take advantage of it because they were freed from the obligation of getting the guarantee of substantial people that what was advanced to them would be repaid. We would be simply giving public money out by a back door, and I think Deputy Hughes and Deputy Cogan will agree with me that that would be a very undesirable proceeding. What is, in fact, required under most of those schemes? First of all, as in Mayo, that the merchant who proposes to sell the seeds and fertilisers should be so assured of the good faith and honesty of his customer that he would be prepared to act as a surety for that man if he applies to the county council for a loan. Is there anything unreasonable in that provision, which is designed to safeguard the community against fraudulent practice? We know that it would be quite possible for a person to buy £5 worth of seeds or £5 worth of fertilisers under this Bill, and then instead of using it on his own land to proceed to trade in it, selling it perhaps for a fraction of what he paid for it, putting the money in his pocket and then snapping his fingers at the county council.
All that is asked in Mayo is that the merchant who engages in such a transaction with a person who has to have recourse to the county council in order to be able to finance it should be able to say: "I think this man is credit-worthy to the extent of the value of the goods which I am prepared to sell him," and that the merchant as a surety should be backed up by another ratepayer, a friend of the person who is anxious to borrow the money. I cannot see anything very vexatious or unduly exacting in a transaction of that sort. I think we would be very foolish indeed if we put the county councils in such a position that they would be compelled to give those loans without asking for a surety, or without the members of the council themselves "vetting" the transaction and being responsible for it. After all, if the county council incurs any losses, the members of the county council will naturally have to meet those losses at the ratepayers' expense. It is just as well, therefore, that we should not put them in a position to say: "If we had known that So-and-So was getting a loan under this Act we would have stopped it, because we knew that he would not use the money properly and that he would not repay it." As matters stand at the moment, those applications come before the members of the local authorities, and any member present when they are under consideration can express his opinion as to whether the loans should be given or not. I think it would be contrary to the ordinary dictates of prudence to adopt any other attitude.
Can the Minister say what is the average amount of the loan?
I was just about to come to that. It has been said that this legislation has not met the position, and that in fact it has been signally unsuccessful. The code, as you know, was in operation until 1933, then it fell into abeyance and was revived in 1939. In 1939 the scheme was adopted in only 12 counties. The number of people who were recipients of loans then amounted to 2,624, and the total cost was £7,331. In 1940 the scheme was adopted in 20 counties, at a total cost of £17,044, and the number of recipients of loans was 3,022. In 1941 the scheme was adopted in 26 counties. The total cost was £55,503 and the number of recipients had jumped to 9,314. The average cost per recipient in 1941 was about £6. Those figures speak for themselves and, I think, will contradict the statements made by Deputies Hughes and Cogan. Bearing in mind that this scheme is designed mainly to help the small man, the man who wants to provide seeds and fertilisers in order to grow food primarily for himself and his family——
And the cottier?
Yes, the cottier. Bearing that in mind, I think the figures I have given indicate that the scheme has been generally appreciated and it has served its purpose.
The point made by Deputy Hughes and Deputy Cogan was that the scheme does not go far enough.
We always have people who say, unless you prefer to give money out lavishly, that the scheme does not go far enough. In present circumstances the substantial farmer has the joint stock banks and the Agricultural Credit Corporation to avail himself of, and, as the much-abused Banking Commission pointed out, so far as credit-worthy farmers are concerned, there are few countries where credit facilities are so adequate as they are here. But, that is outside my function. I am mainly concerned with this Bill, not as a measure to provide credit for agriculturists generally, but as a social measure to enable the small man, the small landholder and the cottier, to finance the growing of food for themselves and their families.
Will the Minister say how the repayments stand?
They have been very good on the whole. Under the 1939 scheme there is about £78 owing out of the total. For 1940 there is something more than that—£2,800—but I expect more will come in in the course of time.
How much was paid by guarantors?
I could not say. If a man becomes a guarantor he must accept the responsibilities of guarantors. Keep a grip on common sense.
Has the Minister ever considered bringing parish councils into the scope of this Bill in such a way that the county councils would be empowered to lend money for the purpose of financing seed and fertiliser schemes through the parish councils? The parish council with which I am connected approached the county council for a loan to operate a seed scheme for labouring men and the county council secretary replied that the council had no power to give a loan to a parish council for such a purpose.
They might not have power to give a loan to a parish council, but they could enter into such an arrangement with the parish council as to ensure that the council would take a reasonable responsibility in operating a scheme among the people of the parish.
In the case that I have referred to, an arrangement was eventually arrived at when the council members went to the bank.
The labourer can get his seeds and fertilisers under this Bill just as well as under a parish council.
I quite realise that, but I suggest that the whole procedure is cumbersome and too troublesome. Labouring men or other people do not like to have to get guarantors. They may not be able to get them. I fully realise the necessity that exists for some security, but it is in order to simplify the situation that I suggest, where parish councils are working, it would be worth while considering an amendment of the legislation so as to give county councils authority to make loans of that description.
If the Deputy will give me particulars of the cumbersome nature of the procedure, I shall look into the matter. So far as I can see, in any of the schemes that have been operating, the procedure does not appear to be cumbersome. It may be that the procedure in Limerick might want to be brought in line with the procedure, say, in Mayo.
It is not any more cumbersome in County Limerick than in any other county.
When is it proposed to take the Committee Stage?
I do not know whether there is any desire to amend the Bill. It is the type of legislation which has gone through the House in the last three years. If we could get the Committee and remaining Stages now, we would be greatly facilitated.
Agreed to take the remaining Stages to-day.