Is the Minister in a position to give any idea as to the sum that might reasonably be expected to be set aside annually for the first five years of the company's operation?
Transport (No. 2) Bill, 1944—Committee (Resumed).
Question put on amendment No. 41: "That the words proposed to be deleted stand."
The Committee divided:—Tá, 62; Níl, 39.
Tá
- Aiken, Frank.
- Beegan, Patrick.
- Blaney, Neal.
- Boland, Gerald.
- Boland, Patrick.
- Bourke, Dan.
- Brady, Brian.
- Brady, Seán.
- Breen, Daniel.
- Brennan, Thomas.
- Breslin, Cormac.
- Buckley, Seán.
- Burke, Patrick (Co. Dublin).
- Butler, Bernard.
- Carter, Thomas.
- Childers, Erskine H.
- Colbert, Michael.
- Colley, Harry.
- Corry, Martin J.
- Crowley, Fred H.
- Lynch, James B.
- McCann, John.
- McCarthy, Seán.
- McEllistrim, Thomas.
- Morrissey, Michael.
- Moylan, Seán.
- O'Briain, Dónnchadh.
- O Ceallaigh, Seán T.
- O'Connor, John S.
- O'Grady, Seán.
- O'Loghlen, Peter J.
- Daly, Francis J.
- Derrig, Thomas.
- Flynn, Stephen.
- Fogarty, Andrew.
- Fogarty, Patrick J.
- Friel, John.
- Furlong, Walter.
- Gorry, Patrick J.
- Harris, Thomas.
- Healy, John B.
- Hilliard, Michael.
- Humphreys, Francis.
- Kennedy, Michael J.
- Killilea, Mark.
- Kilroy, James.
- Kissane, Eamon.
- Lemass, Seán F.
- Little, Patrick J.
- Loughman, Frank.
- Lydon, Michael F.
- O'Rourke, Daniel.
- O'Sullivan, Ted.
- Rice, Bridget M.
- Ryan, James.
- Ryan, Mary B.
- Sheridan, Michael.
- Smith, Patrick.
- Traynor, Oscar.
- Walsh, Laurence.
- Walsh, Richard.
- Ward, Conn.
Níl
- Anthony, Richard S.
- Bennett, George C.
- Blowick, Joseph.
- Broderick, William J.
- Browne, Patrick.
- Burke, Patrick (Clare).
- Cafferky, Dominick.
- Coburn, James.
- Coogan, Eamonn.
- Corish, Richard.
- Cosgrave, Liam.
- Davin, William.
- Donnellan, Michael.
- Doyle, Peadar S.
- Everett, James.
- Fagan, Charles.
- Finucane, Patrick.
- Flanagan, Oliver J.
- Giles, Patrick.
- Halliden, Patrick J.
- Hughes, James.
- Keating, John.
- Keyes, Michael.
- Larkin, James.
- Lynch, Finian.
- McFadden, Michael Og.
- Mongan, Joseph W.
- Mulcahy, Richard.
- Murphy, Timothy J.
- Norton, William.
- O'Higgins, Thomas F.
- O'Leary, John.
- O'Reilly, Thomas.
- O'Sullivan, Martin.
- Pattison, James P.
- Redmond, Bridget M.
- Reidy, James.
- Rogers, Patrick J.
- Spring, Daniel.
Tellers:—Tá: Deputies Kissane and Kennedy; Níl: Deputies Keyes and Larkin.
Question declared carried.
Sections 19 and 20 agreed to.
SECTION 21.
Question proposed: "That Section 21 stand part of the Bill."
It is not intended to require the company to set aside any specific sum annually. All the surplus revenue which may be earned, plus any exceptional revenue which may come in from the sale of land, buildings or unnecessary stock, would presumably be devoted to the purposes of this fund.
No estimate of any kind has been made?
No. It is not intended to require the appropriation of a fixed sum annually for this purpose.
I know, but in relation to this section, in which provision is made for setting aside of a fund, I am asking whether any estimate has been made as to what amount is likely to be paid into the redemption fund for the first five years.
I do not think any reliable estimate would be possible.
Question put and agreed to.
Sections 22, 23 and 24 agreed to.
SECTION 25.
I move amendment No. 42:—
To delete sub-section (1).
Amendments Nos. 42 and 43 deal with substantially the same matter. While the achieving of the object sought in amendment No. 42 would not be altogether satisfactory, it at least provides an opportunity of raising the whole question of what accounts and statistical information the company must provide. In an amendment to Section 9, I sought to require the Minister to lay on the Table of the House any regulations which he was entitled to prescribe for the administration of this measure, and one of the regulations which the Minister is entitled to make is one which enables him to prescribe the form of accounts which the company will keep and any statistical information relating to fares or other activities of the company. I then wanted, and still want, to ensure that the Minister will lay on the Table of the House a copy of the regulation he makes prescribing the type of accounts and statistical information which the company will provide. This is a national undertaking. Its capital will be £20,000,000, and the community is interested in its activities inasmuch as it is being tied up to guaranteeing interest at the rate of 3 per cent. on the debenture stock, which amounts to £16,000,000. It is only reasonable, therefore, that the community should be entitled to know the manner in which the company will keep its accounts, the statistical information it is required to furnish and generally to be made aware, in the most comprehensive manner possible, of the activities of the company.
This amendment, which, as I said, is not quite satisfactory, provides a means of raising the issue and the alternative amendment, amendment No. 43, seeks to ensure that the Minister will be obliged to consult not merely the company as to the manner in which the information will be provided but the transport advisory committee. I can scarcely imagine the Minister being able to raise any valid objection to tabling in the House, for consideration by the House, if necessary, the regulation he makes prescribing the form of accounts which the company must present to him as Minister. If the Minister requires the company to present these accounts in a way which satisfies the House, no harm is done and there is no likelihood of the matter being discussed in the House or of the Minister's action being questioned. If, on the other hand, it is felt that the Minister is not asking the company to provide adequate information for the benefit of the public, the only handicap the amendment would impose on him is to require him to consult the transport advisory committee in order to ascertain what, in the opinion of the Minister, the company and the committee, is the most desirable form of information to be provided.
The Deputy, I think, is inclined to exaggerate the importance of this provision. The purpose of the section as drafted is to enable the Minister for Industry and Commerce to alter, if necessary, the form of the annual accounts required to be prepared and submitted by the company. There is a similar provision in Section 69 of the Railways Act, 1924. The Act of 1911, which is referred to in sub-section (1) of this section, deals with the manner in which all railway companies shall furnish their accounts and returns not merely to the Minister for Industry and Commerce but also to their auditors, to the registrar of companies and to any of their shareholders who may apply for copies.
The purpose of this section is to enable the Minister to require Córas Iompair Eireann to prepare its accounts on more modern lines than has been the practice heretofore, adapting them, as it were, to the circumstances of a general transport company. The Act of 1911 was framed at a time when the only public transport undertakings were railway undertakings. Córas Iompair Eireann will be a general transport undertaking and it will be appreciated that the form in which the accounts were prepared heretofore would be antiquated in relation to modern conditions. The intention is to require the company to produce its accounts in a form comparable with those produced by other commercial undertakings and in a manner that will be more easily understood by people who may not be quite familiar with the details of railway undertakings.
The Deputy's suggestion to consult the advisory committee is not one with which I could agree. I think that body would be a most inappropriate one to be brought into consultation in this matter. Nor do I think that the regulations made in this connection should be tabled. These regulations will be made from time to time, but in any event they will be in such a form as to be of little value for the purpose of discussion in the Dáil.
I think there is at the back of Deputy Norton's mind some fear that the purpose of this section is to conceal in some way information in relation to the activities of the company which the Dáil or the auditors or the registrar and the shareholders should have. The intention is quite the reverse. The intention is to get away from an out-moded system and have the accounts presented in a proper form, in accordance with modern practice, and in as informative a fashion as possible, both from the point of view of the Minister, representing public policy, and the shareholders, who are naturally interested in the welfare of the undertaking.
In fact, the power to prescribe the form of accounts which the Great Southern Railways Company must furnish exists in the 1924 Act, and the regulations, which are not subject to review in the Dáil, could be altered at any time. We are not taking any new power, but in order to make it quite clear that the specific requirements attaching to this company will be different from those attached to all railway companies, it is necessary to have a section in this form enacted. We can alter the regulations under the 1911 Act in relation to all railway companies, but this company will be different from all others in so far as it will be a transport company of an omnibus kind, and the accounts should be in a form appropriate to that kind of company.
The accounts of the new transport company will be somewhat different, we understand from the Minister, from the accounts furnished in the past. The section sets out that the accounts shall be compiled in such manner as may be prescribed by the Minister, after consultation with the company. But a new position will arise in connection with this, because there is the amalgamation with the Dublin United Transport Company, and I would like to urge on the Minister and the House the importance of having those accounts shown in a separate manner. Whatever argument may be made for the inclusion of the Dublin United Transport Company in this new company, at least nobody can deny that it will be bringing into the new company a regular income and, I think, a rate of profit relatively far in excess of that of the old Great Southern Railway.
As a citizen of Dublin, and as a representative of the citizens, I am nervous of a situation arising in which the citizens, due to the fact that they are not organised, as in such matters all citizens should be, will be asked to pay fares at an exorbitant rate. Nobody here, not even the Minister, can categorically say what is going to happen in the future. In these circumstances I think we ought to take what sensible steps we can to see that no situation will arise in which the fares will be exorbitantly raised. The Dáil should decide that what I might call the purely bus and tram section of the new transport company will have its accounts separated, so that it can be clearly seen whether the citizens of Dublin are paying too much for the privilege of amalgamation.
In that connection in the past the citizens have had some rather unfortunate experiences. I do not wish to go into those very deeply, but I should like to mention what happened on the Dalkey line. I think I am correct in saying that when there was the competition of other bus companies, before the amalgamation, it was possible to travel to Dalkey and back by tram for sevenpence—that was the cost of the return ticket. To-day it costs ¼ to travel to Dalkey by bus. When the trams come back next week it will cost ½. That is just one example of what happens when competition is taken away—and all competition will be taken away under the new proposals. The railway line to Dalkey will be under exactly the same ownership as the trams or buses which will in future travel to Dalkey.
The Deputy must be aware that this section deals only with the manner in which accounts shall be prepared and presented.
I am drawing attention to the unhappy experiences of the past. The citizens of Dublin have on occasions been charged a high rate. I wish to make the point that the accounts of what is now the Dublin United Transport Company should be kept separately from the accounts of the other company. They should be shown in a separate manner in the balance sheet.
I think the Deputy raised that matter before on another section.
I mentioned it then, but I think it is more relevant now and I would like to get a statement from the Minister that he will endeavour to have the accounts presented separately.
I think this is a suggestion to prevent the new company getting any benefit out of the amalgamation. If they have to keep the two undertakings in water-tight compartments, they will not be able to effect the economies and alterations in the method of working which the amalgamation would otherwise permit. I consider it would be perfectly unjustifiable for the Dáil to impose such unnecessary expense on the company.
I fail entirely to see the Minister's point. Before the war the railway companies were in the habit of publishing traffic returns every week and, I think, passenger receipts. I do not see why the accounts should not be published separately. In fact, they will have to be kept separately, otherwise there will be no check on what receipts were obtained from the various bus lines. I am afraid it looks as if the public——
There will be no difficulty in getting information concerning the different services. If the Deputy wants separate accounts for the Dublin United Transport Company, it will mean that the work in the repair shops, and the staffs, must be segregated between the two undertakings.
They would have to be segregated anyway.
I do not think so.
You could not have all the bus shops being lumped in with the Great Southern Railways shops.
The Great Southern Railways runs more buses than the Dublin United Transport Company.
It does, but it is the charges I am interested in.
The importance of this section and of the amendments put down in Deputy Norton's name and my own cannot be exaggerated. The attitude adopted by the Minister in a previous discussion relating to this matter, and his refusal to meet these reasonable amendments, compel me to believe that he wishes to conceal information which members of this House are entitled to get, especially in view of the drastic powers contained in this and other sections of the Bill. I ask Deputies who are interested in this matter to realise that, once the Bill in its present form is passed by this House, we will not be allowed to ask one question here concerning the financial administration of this concern. The reason why I suspect that the Minister and his nominee, the present chairman, are anxious to conceal information previously available is this: Look at the accounts for the year 1941, the year prior to the coming into office of the present chairman. They contain 20 pages of interesting information concerning financial administration, personnel and all the essential details in connection with the working of every section of the railway service, including the omnibus, the road, freight and cartage sections. They also contain a certificate from every one of the chief officers, the chief mechanical engineer, the shareholders' auditors, and the company's auditors, that well-known London firm, Price, Waterhouse & Co. They also bear the signature of the chairman and secretary. In other words, there is a certificate from the chairman and secretary representing the board, and from the chief executive officers, in regard to the condition of the company's rolling stock, permanent way and everything else. It is all very valuable information. Now look at the accounts for 1943, containing two pages, and described on page 2 as an abridged statement of financial accounts and statistical returns, depriving the taxpayers of the future or the common stockholders, or anyone else who is interested, of very valuable information.
Another practice has been discontinued by the present chairman, presumably with the consent of the Minister, and a good deal of discussion here in this House in regard to gambling on the stock exchange might have been unnecessary if the practice had been continued. Anybody who knows as much as the Minister does about this whole business is aware that it was the practice of the board of the company to publish what were known as weekly traffic returns, giving detailed particulars of the tonnage and the gross traffic receipts from year to year. The present chairman, for some reason that I do not understand, suspended the publication of those traffic returns as from a certain date. Members of the public, shareholders in the company, and anybody else who was interested, particularly those who gamble in railway shares on the stock exchange, had access to the weekly traffic returns published over a long period of years. Everybody had the same amount of information. The publication was suspended for some reason which the Minister may, if he wishes, give the House, but we do not know the reason up to now. Those weekly traffic returns are still furnished to headquarters, as far as I know.
They are still published periodically.
For some long time past the weekly traffic returns have not been published. I should like the Minister to give me information as to when they were last published. I know they are made up. They have to be made up from figures submitted by every section of the Great Southern Railways Company. In the making up of those figures hundreds of officials of the company are involved. They could convey to their friends, if they wished, the information contained in those weekly traffic returns. That applies especially to the people at headquarters. But why should the public, the common stockholders, or any other section of our citizens, be deprived of that information, after the coming into existence of this organisation, seeing that every section of the taxpayers may possibly be involved in its financial affairs? If it fails, they will be involved, because they will have to provide the money to make up the deficit. They should be furnished with all those particulars, and this House should not pass this section in the form in which it is inserted in the Bill at the moment unless some undertaking to that effect is given by the Minister to the members of the House. If we pass it in its present form, we may put in whatever Parliamentary Questions we like after 1st January next and we will be told that the matter has nothing to do with the Minister.
I think the Minister might see fit to consult the advisory council or committee which is being set up under the terms of this Bill. I do not know what that body is going to be consulted about, but if they are to be a representative body of intelligent people they will have to be consulted about something; otherwise they will have no function at all. This is a matter upon which I think they might be consulted. In my opinion this is a question upon which a regulation should be made. I think regulations in connection with this particular aspect of the organisation should be laid upon the Table of the House, in order to give an opportunity to members of the Dáil, after 1st January next, to deal with the form prescribed by the Minister for the presentation of the company's accounts. I hope the Minister will not stand up and say that the reason why all this information which was given up to the end of 1941 is not given now is that there is a shortage of newsprint. He need not give that explanation to me at any rate, because I know perfectly well that there was plenty of newsprint available to enable every portion of the speech made by the Minister in this House on the Second Reading of this Bill to be circulated all over the country.
There is another small point concerning this matter to which I wish to refer. This copy of the accounts which I received appears to be different from the one which the Minister had in his possession here in the House a few nights ago. This is an abridged statement of financial accounts and statistical returns. Apparently there is a second set of accounts which can only be secured by shareholders on application to the secretary of the company. Naturally, it costs more to print two sets of accounts than it would cost to print one set of accounts giving whatever information should reasonably be given to the taxpayers of the country after this Bill comes into operation. I again appeal to the Minister to reconsider what he has said regarding his refusal to consult the advisory council in connection with the manner in which accounts should be presented by the company to all those who are interested in its future well-being.
The abridged accounts were published in that form for the convenience of people who wanted them in that form. It was pointed out in the annual report that the official accounts and the statistical returns in full would be supplied on application to any shareholders of the company. These additional accounts which I have mentioned have been issued as usual. There is no alteration in the regulations. The weekly statistics were published by the company voluntarily. There was no statutory obligation to publish them. Anybody familiar with those returns would fully understand that they could give no indication of any kind as to the financial position of the company at any time. The suspension of the publication of the weekly accounts was adopted as a measure of economy.
Economy?
It involved a substantial amount of work on the part of the clerical staff and, as the services of the clerical staff were required for more urgent businéss, owing to the circumstances of the time, the weekly publication of the return was stopped.
What was the estimated saving?
I could not say. It was not a question of saving money but of saving time.
I am pretty certain it did not save the cost of one clerk.
This section gives no more power than the Minister for Industry and Commerce has under existing legislation, except to the extent that the existing regulations applied to all railway companies and not merely to Córas Iompair Eireann, the new company constituted by this Bill. The purpose of this section is to ensure that he will have full power to require the submission of returns and accounts in a proper commercial form, in a form proper to a general transport undertaking which is not merely a railway undertaking, which were the only types of undertakings extant when the 1911 Act was passed.
Does the Minister see any real difficulty in consenting to tabling in the House a copy of the regulations which he makes, indicating the manner in which he requires the company to furnish their accounts and statistical information? If the Minister is acting correctly in the matter, then he need not bother his head about the regulation he has made. If, however, the Minister is not requiring the company to provide the information which the House requires and deems necessary, the matter can be discussed in the House and the Minister can make whatever explanation he desires, and the House can pass judgment as to whether the Minister is wise or unwise in the manner in which he has acted.
I have no objection whatever to answering in the House questions as to why the regulations take a particular form, and I have no objection to giving the Dáil full information as to the form in which the regulations have been made, but I think it an undesirable precedent, in relation to matters of that kind, that the Dáil should have the power to annual them. That is what Deputy Norton proposes. Every Deputy interested will know precisely what the regulations are, and will be able to see them published, and see the accounts prepared in accordance with them; but it is entirely different to say that these regulations should be submitted to the Dáil, and be capable of being annulled by the Dáil in accordance with the usual procedure. That is the form adopted only where questions of policy arise, which are a matter of giving a Minister power to make regulations in order to avoid a great deal of unnecessary details in legislation. In this case, it is a matter of administration only. The proposal, from the point of view of legislation, is that the Minister for Industry and Commerce, as the protector of the public interest, should have the power to prescribe the form in which this company shall prepare returns, not merely for submission to him, but for its auditors, and for submission to the registrar of companies. That is the proposal here, and it is the intention that that function should be discharged as a purely administrative one. The Minister is taking power to amend the regulations at any time he thinks such amendment is necessary or desirable.
Would the Minister consent to lay a copy of the regulations on the Table of the House, even without power to annual them?
The accounts will be presented to the Dáil.
But the Minister will have power to prescribe the manner in which they are presented. Will he undertake to lay the prescription Order on the Table, even without power to annual it?
It may be that from time to time the regulations will be altered, and I think it would be wrong that the regulations should be open to annulment at any time in the Dáil.
Would the Minister say whether the information previously prepared at every station on the system and made up of weekly traffic returns, and previously published, is not still being sent up by the same stations in practically the same form and summarised at headquarters for the information of the chairman and members of the board?
There are traffic returns published at less frequent intervals than weekly.
What is the objection? If the Minister can give a good objection, I am prepared to swallow it.
I am raising no objection to the publication. It is not statutorily binding on the company, but done of its own free will, and if, at any time, they decide not to do it, that is their business.
I am of the opinion—I am gambling my opinion now—that if the weekly traffic returns published over the last 20 years had been published during the year 1943, this gambling on the stock exchange would not have occurred and there would not have been all this hullabaloo.
Perhaps the Deputy believes in buying or selling shares on the information in the weekly traffic returns? As an indication of the financial position of the company they are worth nothing, and everybody knows that.
I have a fairly good idea of the amount of time it takes to make up the information at the ordinary stations on the Great Southern Railways, to summarise the information at the stations concerned and send it to headquarters. I do not know of any station in the country where a reduction of the clerical staff has resulted from the failure of the company to make up and publish this information. There may be some reactions in the section at headquarters, but to say that it is anything in the nature of a great saving is a big joke.
It is desirable that we should have the maximum statistical knowledge of matters of that kind in an easily understandable form, but we are concerned here only with the accounts of the company. The company published that information in the past voluntarily. It is still available in publications of the Central Bank and in the Trade Journal.
As far as the Minister is concerned, is it the intention in the future to urge the chairman or the responsible authorities in the railway to prepare and present, even monthly, a public statement of the financial position?
I think it is. I certainly will undertake that I will ensure—and I know that in this matter the chairman and the board will be undoubtedly anxious to co-operate— that the full amount of statistical information which is required to enable the activities of the company to be properly appreciated will be available.
Monthly, even?
I do not say that. I want Deputy Davin to get it into his head that Córas Iompar Éireann, as well as being a railway company will be a general transport concern and, in certain respects, road transport may be as important financially, if not in respect of the employment it gives and other aspects, as the railway undertaking. The regulations of the 1911 Act applied to railways only. This is an undertaking which is not a railway company only.
One could understand the Minister's reluctance on this matter if he would take one of the two alternatives—either to lay the regulations on the Table of the House or to consult the transport advisory council. He is not quite correct when he says that it is a purely administrative function to prescribe regulations and that no question of policy is involved. Policy may not be directly involved, but policy is affected. We have a similar situation in regard to other vital statistics prescribed and collected by officials. We have to remember that it will not be the Minister as an individual who will be laying down the prescribed regulations, although it will be done over his hand. The work will be done by his officials.
We have the case of the vital statistics of our country where there are very important lapses in the making up of these statistical analyses, as compared with other countries. We have the same with regard to other information, where the technical man who prescribes the form of statistics or accounts approaches it from the purely technical viewpoint and forgets altogether that statistics do affect policy. I would be more concerned with the second alternative, namely, to consult the transport advisory council, because of the fact that, in a later section of the Bill, the duties of this council are set down as being to consider, report and advise on any matter referred to it by the Minister. The Minister has gone to some pains to set out that one of these persons shall be a person experienced in commercial and industrial affairs, that a second shall be, in the opinion of the Minister, experienced in labour matters and that a third shall be experienced in transport. It is quite conceivable that the Minister's officials may prescribe the form of accounts—accounts on which this advisory council will subsequently have to consider and advise the Minister in relation to matter referred to it—and that these three persons experienced in three forms of commercial and industrial undertakings will find, from their own particular knowledge and experience, that the accounts do not meet their requirements, in so far as the question of policy arises. I do not see any reason why the Minister should hesitate to consult with those whose expert knowledge he is later going to call upon and whose expert knowledge must be based on the accounts furnished to them by the railway company in such matters as come before them. I think the Minister would be well advised, even from his own point of view, apart from the feeling of any group in the House, to see that in the prescribing of the accounts, the experience and knowledge of those who will constitute the advisory committee will be utilised to see that not merely all the information required is made available but, more important still, that it is made available in such an analysed form as the Minister requires and in relation to the matters on which they would be required to advise the Minister.
The other point raised by Deputy Dockrell is one that should also be borne in mind. It is quite true that we are going to deal with a single company. No longer will the Dublin Transport Company or the Great Southern Railways Company exist; we shall have a single transport unit, but it is important for the citizens of Dublin to know what is to be the outcome of the amalgamation as far as they are concerned. The Minister's reply that it would be necessary to present a completely different set of accounts and that this would involve difficulties is all by the way. The Minister knows that when buses are made or repaired in a joint way, the cost of the making or the repair will be entered against the particular section of the system from which the bus comes.
There is one important feature which is a point which the Minister has glossed over many times and that is that the Dublin United Transport Company—I am speaking now of it not in relation to its corporate identity but merely as the transport system of Dublin—starting in 1936 had a net profit of £91,000, in 1937 of £78,000, in 1938 of £83,000, in 1939 of £100,000, and in 1943 of £333,000. The Minister is not going to fool the public or pull the wool over their eyes by saying that that increase from £100,000 to £300,000 was solely the outcome of very good management and wise financial administration. We, in Dublin are concerned to know whether the methods which have been utilised in Dublin during the years that that surplus has grown from £100,000 to £300,000 are going to continue and, if they are going to continue, where the benefit is going to accrue. If it is merely going to be a question of Dublin being the milch-cow for the whole national transport system, on the basis of the conditions we have had to put up with in Dublin for the past three or four years, we ought to know it with our eyes open. There should not be any possibility of that particular form of extraction from the citizens of Dublin being covered up by having the accounts so prescribed as to lose the identity of the Dublin section of the system. The separation of the accounts in the manner desired does not present any difficulty. It merely means that up to a certain point the ordinary income and out-goings of each activation of the company are scheduled and set aside before being put into the common pool. Certainly the Dublin citizens are entitled to know whether they are being requested to pay an excessive price for their transport in order to ensure that the reorganisation is going to be a success, a thing which the Minister sometimes seems to doubt.
With regard to the advisory committee, it would be a completely inappropriate body to bring in on this matter. It would be no part of its function to advise on the administrative affairs of the company. The Deputy need not be afraid that the committee will be in any way prejudiced in the discharge of its functions by the form in which the accounts are prescribed, because we propose that the committee should have all the powers of the High Court to require the attendance of witnesses and the production of documents and to get any information whether it is prescribed in the accounts or not. I could not agree that there is any case to be made for the keeping of separate accounts for the Dublin area any more than there would be for the Cork area. We are now establishing a national organisation and once that is established a new situation has been created. I think it would be completely wrong to do as Deputy Larkin suggests, to put this obligation on the company with all the inconvenience that that would involve merely to give opponents of the national organisation certain ammunition to use.
What about the victims?
The victims will know whether they are properly so described as time goes on.
Would the Minister say under what section the committee will have the powers be mentioned?
I think Section 62.
Section 61 says:
"It shall be the duty of the advisory committee to consider, report to and advise the Minister on, any matter which is referred to them by the Minister under this Act."
And these matters are specified.
Will the Minister say under what section they are specified?
In a number of sections relating to questions of charges, conditions of carriage and adequacy of services. These are matters for the committee to deal with. The committee deals with representations from the public or sections of the public relating to conditions of carriage, rates of charges and adequacy of facilities.
If the Minister submits them to them.
The Minister may refer them to them.
There is no case for the advisory committee unless the Minister refers it to them, so the advisory committee has no function in the world unless the Minister calls on them and says that he wants them to do this. I think there is nothing that would be more important for the transport advisory committee to consider, or at any rate to be in a position to consider, than the relative costs of the various types of services. The transport advisory committee should be in a position to advise that the accounts should be presented in such a way that we shall see to what extent the road services are paying for the rail services, and to what extent the passenger services in the City of Dublin are paying for the road services throughout the country. How we can have an assurance, particularly under monopoly control, that the most efficient and the cheapest transport is being given to the country except we can examine these things, I do not know.
The Deputy is assuming that the purpose of this section is to prevent his getting this information. The purpose of the section is to ensure that he will get the information.
I am assuming that, and we have every reason, after what has been done and what has been said, for assuming that. It has been pointed out before that, contrary to the explicit recommendation of the Transport Tribunal, £1,100,000 has been taken from the City of Dublin for the repayment of debentures. There was £682,000 taken for the repayment of debentures which had formed part of the company's borrowings from 30 to 40 years. That money has been recouped out of the payments of the citizens of Dublin for their transport since 1939.
I think it would be very disastrous to the confidence of the people generally in the administration of their transport, knowing that it was possible for such a thing to happen in Dublin, if they felt that there was no need for finding to what extent that might happen in future or to what extent high charges paid by the passengers of the City of Dublin, largely working people, might be utilised in order to maintain the road system or the rail system in other parts of the country. I do not think there can be an efficient preview of the way in which transport is organised and the return transport is giving the country unless we have a system of statistics that go to show to what extent money is being paid towards one part of the system by the running of another part.
Is it the Minister's intention to provide for the presentation of accounts in such a form as to show the revenue and expenditure under road freight and cartage (omnibus) as distinct form the rail services? I am not personally acquainted with the form in which the Dublin United Transport Company accounts are at present presented but the Minister appears to think that they are presented in model form.
No.
The Dublin United Transport Company has no road freight and cartage section. It is an omnibus company and there would be three separate sections in this unified system—road freight and cartage (omnibus), and purely rail services. Will they be presented in such form as to enable Deputies, shareholders or taxpayers——
To understand what parts of the system are paying and what parts are not?
Yes.
Certainly. That is the purpose of the accounts.
Amendment No. 42, by leave, withdrawn.
I move amendment No. 43:—
In sub-section (1), line 55, after the word "company " to add the following words: "and with the Transport Advisory Committee".
Amendment put and declared lost.
Section 25 and 26 agreed to.
SECTION 27.
I move amendment No. 44:—
Before Section 27 to insert the following new section:—
(1) The company shall, not later than twenty-one days before the ordinary meeting of the company to be held in any year (other than the year 1945), forward, on the request of any holder of stock of the company, to that holder a copy of the accounts (prepared in such form as the Minister may direct for the purpose of this section) of the company for the immediately preceding year.
(2) So much of sub-section (3) of Section 1 of the Railway Companies (Accounts and Returns) Act, 1911, as requires an incorporated railway company to forward a copy of the accounts and returns to any share holder or debenture holder of the company who applies for a copy shall not apply to the company.
The purpose of this amendment is to enable a form of accounts to be prepared for the shareholders on more commercial lines than those prescribed by the Railways Act, 1911. That Act, as I explained before, applies to companies generally and is being retained to enable the Government to secure uniform financial and statistical information for transport policy purposes. Section 25 of the Bill, which has just been passed, provides that the information to be furnished under the 1911 Act by the new company may be amended. The amendment is to ensure that these accounts may be and will be furnished to the shareholders of the company in accordance with the form prescribed.
Amendment agreed to.
I move amendment No. 45:—
To delete sub-section (4) and substitute therefor the following new sub-section:—
(4) A director, officer, official or employee of the company shall not be eligible for election as auditor and any firm of auditors in which a director, official, officer or employee of the company has any interest by way of partnership, shareholding or otherwise shall not be eligible for election as auditors.
Section 27 provides for the appointment by the company, at its annual meeting, of an auditor or auditors who will audit, the accounts of the company. Sub-section (4) of the section provides that director or officer of the company shall not be eligible for election as auditor. The object of the amendment, however, is to ensure that a firm of auditors in which a director, officer or official of the company has an interest shall likewise be ineligible for election as auditor. That would create the position then that not only will a director or officer of the company not be eligible for election as auditor, but that a firm of auditors will not be eligible for election if an officer, a director or an official of the company has an interest in that firm. I think the Minister will see quite clearly that the object of the amendment is to prevent any suggestion that anybody who is a director, officer or official of the company can arrange matters in such a way that his friends in the auditing line can have anything to do with the accounts of the company.
I do not think we should accept this amendment. It seems to me to convey an implication against the integrity of the accountants' profession. I do not know if that was intended, but that is what is conveyed to me. The election of auditors is a matter for the company, and I do not think we should limit their discretion any more than is done in the Companies Act.
We are setting out here to prevent a director or officer of the company being eligible for election as auditor. The Minister carries the reflection, if it can be so described——
Oh, no!
——the Minister carries the reflection, if it can be so described, to the extent of saying to a director or officer of the company: "You cannot audit the accounts of the company," but, if a director has an interest in an accountancy firm, operating either under his own name or under another name, then that company can audit the accounts of the railway company even though the senior partner in that firm of accountants may be a director or officer of the company. If the Minister goes so far as to say that a director or officer of the company will not be eligible for election as auditor, it seems to me to be necessary corollary to that that if a director or officer of the company has an interest in a firm of accountants, that firm ought likewise be debarred from auditing the accounts of the company.
The provision we are proposing to make here is in accordance with the terms of the Companies Acts, and I do not think we should go beyond that.
Is it possible—it could happen, as the Minister knows—for a person to have an active interest in a firm of accountants in the city, to be in fact a partner, to have the biggest shareholding interest in the firm and, while not personally eligible to audit the company's accounts, his company could nevertheless undertake the auditing of the accounts of the railway company? If that is so, it is an outrage. That is possible according to what the Minister says.
If the Deputy has in mind that the present chairman of the Great Southern Railways Company is associated with the firm of Reynolds McCarron & Company, I can assure him that that is not so. He has no association whatsoever with that com pany at present.
I am not concerned as to whether he has not.
That is the origin of the amendment, is it not?
Assuming he had an interest in the company—the Minister appears to know whether he has or not—under this section his firm would be entitled to audit the accounts of the railway company so long as he did not personally undertake the audit. I am not interested in personalities at all but if the chairman or a director or officer of the company were associated with a firm of accountants and if that firm of accountants could audit the accounts of the railway company so long as the chairman or director or officer did not himself audit the accounts, it represents a very extraordinary situation.
The auditors are elected by the shareholders; they are not appointed by the directors.
I know that.
They are entitled to make whatever provision they like.
Everybody knows the way things can happen at company meetings. Everybody knows the abuses that are associated with the exercise of proxies.
If it is considered desirable to amend the companies law in general in relation to all companies to make a provision of this kind, I would be prepared to consider it. I do not propose to single out this company, to suggest that there is something about this company that requires a special provision that does not apply to all others.
I am putting it to the Minister that it is undesirable that a director of this company, having an interest in a firm of accountants, should be able to witness a situation in which that firm would audit the accounts of the railway company. That cleanly, is undesirable, and this amendment seeks to ensure that it cannot possibly happen. The Minister admits that it is not desirable to have a director or an officer of the company who may be in a position to audit the accounts of the company, but it would appear that he is prepared to look calmly, in the case of this company, at the possibility of directors of officials of the company auditing its accounts. I think that, obviously, such a situation would be improper and irregular.
All I can say is that if there should have to be an amendment of the law in that regard, it would have to be done generally, but I think that is should be obvious that in the case of this company it would hardly be necessary.
How does the Minister make out that it is obvious?
At any rate, the implication here is obvious—that there is reason for special precautions to be taken in the case of this company.
Even if that were so, is it not justification that under the Minister's provision neither the chairman nor any of the directors or officials of the company shall be eligible for election as auditors? Suppose that a director should be appointed, who is also an accountant: is it not possible for his firm of accountants to be appointed to the position of auditors of the company's affairs? I am sure that the Minister himself would not advocate that a member of the company should also be in the position of being auditor of its accounts.
I think we should leave that matter to the discretion of the shareholders of the company, as they are the people who elect the auditors.
Even a director's own company?
No.
But that director's company can be appointed as as auditors?
It is purely a question for the shareholders as to whom they appoint as auditors.
Is it not possible that they might appoint as auditor a director who had a controlling interest in the company?
That is an implication of dishonesty which I am not prepared to accept.
Surely, there is no suggestion of dishonesty there. We are merely pointing out that it might happen that the firm of a director, who had a controlling interest in the company, might be appointed as auditors of the company's affairs?
I cannot accept the implication there.
Question put: "That the words proposed to be deleted stand".
The Committe divided: Tá, 60: Níl, 32.
Tá
|
Aiken, Frank.Beegan, Patrick.Blaney, Neal.Boland, Gerald.Boland, Patrick.Bourke, Dan.Brady, Brian.Brady, Seán.Brennan, Thomas.Breslin, Cormác.Bukley, Seán.Burke, Patrick (Co Dublin).Butler, Bernard.Carter, Thomas.Chiders, Erskine H.Colbert, Michael.Colley, Harry.Corry, Martin J.Crowley, Fred H.Daly, Francis J.Derrig, Thomas.Flynn, Stephen.Fogarty, Andrew,Fogarty, Patrick J.Friel, John.Furlong, Walter.Gorry, Patrick J.Harris, Thomas.Healy, John B.Hilliard, Michael. |
Humphreys, Franeis.Kennedy, Michael J.Kilory, James.Kissane, Eamon,Lemass, Seán F.Little, Patrick J.Loughman, Frank.Lydon, Michael F.Lynch, James B.McCann, John.McCarthy, Seán.McEllistrim, Thomas.Morrissey, Michael.Moylan, Seán.O Briain, Donnchadh.O'Connor, John S.O'Grady, Seán.O'Loghlen, Peter J.O'Rourke, Daniel.O'Sulliyan, Ted.Rice, Bridget M.Ruttledge, Patrick J.Ryan, Mary B.Ryan, Robert.Sheridan, Michael.Smith, Patrick.Traynor, Oscar.Walsh, Laurence.Walsh, Richard.Ward, Conn. |
Níl
|
Blowick, Joseph.Broderick, William J.Browne, Patrick.Burke, Patrick (Clare).Coburn, James.Cogan, Patrick.Coogan, Eamonn.Corish, Richard.Costello, John A.Davin, William.Donnellan, Michael.Doyle, Peadar S.Fagan, Charles.Halliden, Patrick J.Hughes, James.Keating, John. |
Keyes, Michael.Larkin, James.Lynch, Finian.McFadden, Michael Og.McMenamin, Daniel.Mongan, Joseph W.Mulcahy, Richard.Murphy, Timothy J.Norton, William.O'Driscoll, Patrick F.O'Higgins, Thomas F.O'Leary, John.O'Sullivan, Martin.Pattison, James P.Reidy, James.Rogers, Patrick J. |
Tellers:—Tá: Deputies Kissane and Kennedy; Nil: Deputies Keyes and Corish.
Question declared carried.
Section 27, as amended, agreed to.
SECTION 28.
I move amendment No. 46:—
In line 55, to delete the words "three months after the end of each financial" and substitute the words and figures "the 31st day of March of each".
This is a drafting amendment. The wording of the original was such that the company could hardly comply with the requirements laid down. This amendment merely clarifies the position.
Amendment agreed to.
Section 28, as amended, agreed to.
Sections 29, 30, and 32 agreed to.
SECTION 33.
I move amendment No. 47:—
To delete sub-section (1).
This amendment was put down for the purpose of preventing any further facilities or encouragement being given for the continuance of this out-of-date proxy voting system. I do not know if the Minister is aware of the power that is wielded by a very small number of individuals who have been privileged to use this method of voting. It is a method that is used by the management of the Great Southern Railways Company and, presumably, by the Dublin United Transport Company. I know, and I am sure the Minister knows, that some of the existing directors of this company go around on a canvassing tour collecting proxies from convents, banks and other institutions. Naturally, they get them very easily from banks and other institutions. These proxies give them the power to carry their own point of view at a shareholders' meeting when their authority is challenged.
It was reported in the press in recent times that, when the shareholders of the Great Southern Railways Company challenged the authority of the existing directors to do certain things which, in their opinion, were not the interests of the company, the chairman of the company pulled out proxies from a box—on some occasions they would not all fit in his pocket—and planked them down on the table. With these millions of proxies, he simply declared that the motion moved by the common or ordinary stockholders was defeated. This section, as it stands, proposes to extend the existing objectionable system. I hope that the Minister will either give a good reason for the insertion of sub-section (1) or agree to accept the amendment.
I think the Deputy somewhat misunderstands the position. There are no provisions in relation to this company in the matter of proxy voting that do not apply to all companies. By Section 7 of the Bill, which incorporates the Companies Acts, we have already provided for proxy voting in accordance with the provisions of the Companies Acts. One schedule of the Companies Consolidation Act of 1845 has, however, not been incorporated for other reasons, and it is that schedule that provides for the appointment of proxies under power of attorney. It is, therefore, necessary to insert this section here to enable the same provision as exists in the Companies Consolidation Act relating to the appointment of proxies under power of attorney to apply in the case of this company.
The general power for the appointment of proxies is covered by the incorporation of the Companies Acts in the Bill, and it is merely a matter of drefting that the sixth schedule of the Companies Consolidation Act of 1845 could not be incorporated, and that special provision has to be made in this section fir the appointment of proxies under power of attorney. We are not proposing, in relation to this company, any provision in that regard that does not apply to all companies coming under the Companies Consolidation Act of 1845.
At some stage the question of the revision of that Act will arise, and, possibly, legislation will be proposed for that purpose. I think it would be a matter of very dubious wisdom to propose that the power of appointment of, and representation by, proxies should be abolished because it might lead, in certain cases, to very undesirable decisions being made on behalf of shareholders of a company, by a minority of those shaerholders who found it convenient to be present at the annual meeting. I think that in the regulation of companies it is clearly desirable that every shareholder should have the the right of expressing his views by his vote at the annual meeting. even when he cannot be present, and that, of course, is the purpose behind the power to appoint proxies. However, we are not, as I have said, proposing in relation to this company anything that does not apply to every other company under the Companies Acts.
I take it from the Minister's statement that the power would still remain for individual shareholders to appoint proxies even if this section of the Bill were deleted.
That is right.
That does raise a principle which the Minister appears not to realise—the principle of proxy voting by corporate bodies in relation to this new company. The Minister's defence, as in the case of the previous section, is that we should not seek to alter general company law in dealing with a particular company. But we are dealing here with a company of a peculiar nature and having a peculiar interest for this legislative body, because we are the parents of this company and we are undertaking responsibilities on behalf of the citizens in bringing it into being. It would be a bad principle if we were to have a situation arising similar to that which arose in the past in the case of the two companies now being amalgamated —the possibility of two, three or half a dozen shareholders, or directors, exercising, by the proxy votes of corporate bodies, an overwhelming voting power a the annual meeting. There is no desire on the part of the mover of the amendment to exclude or limit in any way the right of the individual shareholder or any shareholder to have his views expressed by proxy vote.
The objection is to proxy votes being exercised on behalf of a corporate body. In the past, the influence and weight carried by the proxy votes given by corporate bodies to shareholders at annual meetings has been the determining factor at these meetings. They have determined policy for the company and they determined personnel so far as the board of directors was concerned. As a matter of fact, these proxy votes are the root cause of our present legislation. The inability of the management of the company to take advantage of the aid given in legislative form from time to time by the Government in order that the company might adapt itself to changing situations has brought the company to its present pass. We have had this sorry result in the past because of the system of proxy voting on the part of corporate bodies and this concentration of voting power in the hands of a small number of individuals. In dealing with the company in which large public interests are directly involved—not only is the question of Government guarantees but the question of public policy as a whole is involved—it is a good thing to ensure that this system of block voting will not be permitted to continue, as in the past, to such an extent that the effective voting power at the annual meetings can be concentrated in a small number of hands.
It will not interfere, as the Minister pointed out, with the rights of the individual shareholder. It will not interfere even with the rights of the corporate bodies because, with the exception of certain religious bodies, the other—banks and insurance companies—always be represented at the annual meetings. There is no difficulty about the matter. This collection of proxy votes given by the corporate bodies and concentrated in the hands of a number of individuals, mainly directors—sometimes solicited and sought in a sort of "general election" campaign—has been in many ways a bad influence on the general life of the country for the past ten or 15 years. We should pay attention to the views expressed on a number of occasions by ordinary shareholders. Those who had gone to the trouble of attending the annual meeting to expressed their views, perhaps in a constructive way, with regard to the management of the company were overborne by the silent votes of shareholders not present at the meeting. That may be a situation which can be allowed to continue under the company law as a whole until such time as we come to deal with the amendment of that law, but here we are dealing with a company which we are bringing into existence now and in which public policy and, possibly, public finance, are involved. I think that the Minister should ensure that public policy and public finance will not be at the mercy of those silent votes, sought for, canvassed and exercised by individuals who, in the past, have shown themselves incapable of carrying on the management of the undertaking of which they were given control.
I do not follow that argument. We are constituting this company. The company will consist of the holders of the common stock. That may be a good thing or a bad thing but it is what we have decided upon. These individuals may be wise or foolish, in our judgment, but we have decided to constitute them the company. I do not know how many of them there will be—whether 3,000, 4,000 or 5,000. Conceivably, we might say that they must meet in person at the annual meeting of the company to discharge the business which falls to be done. But company law says that shareholders may be represented there by proxy—that they may give another person the right to vote on their behalf on any issue that arises. That is what company law permits in regard to other companies and what I propose it should permit in the case of this company. That is a far a safer arrangement than taking the risk that only a minority of shareholder will turn up and that they may arrive at decisions contrary to the wishes of the majority, or decisions detrimental to the interests of the company, in the view of the majority. The Deputy may object on the ground that the majority of the shareholders in the past chose to give their proxies to the directors of the company. Acting on their own judgment, they chose to do that. It may be held that those directors were not always worthy of the confidence the shareholders placed in them, but in the type shareholders must be given the right to decide who will represent them.
That does not really arise on this section because power of representation by proxy at the annual meeting is provided for by the Companies Clauses Consolidation Act, which is incorporated in this Bill. It was a mere drafting difficulty which made it impossible to incorporate, at the same time, the power to appoint proxies under power of attorney. Even if we were discussing the general question of company law, we should be very slow, indeed, to provide that a shareholder should only be able to exercise his vote in person at the annual meeting of a company. That would be an undesirable practice to establish having regard to the risk it would involve. I think that these is noting undemocratic or unsound in principle in the theory of giving shareholders the right of representation at company meetings, the right to act through a representative, because that is, in fact, what the appointment of proxies amounts to.
The Minister's argument might be quite sound if he were not aware that the majority of shares are held by the Bank of Ireland, other banks and one or two big institutions.
I do not know that that is the case.
Nobody is in a better position to find out than the Minister, and I should be obliged to him if he would ascertain what percentage of the stock of the Great Southern Railways Company which is to be turned into common stock will be controlled by the Bank of Ireland and other banks. I am assured that the present directors are selected at private meetings of the directors of the banks. My objection to this whole business in that one of those directors named in the proxy forms can go down to a shareholders meetings and, irrespective of the arguments put up against a particular policy, can pull out of his pocket or out of a box a bundle of proxies and carry the meeting against the wise of single shareholders.
An alternative decision could be arrived at by a minority.
Mr. Corish
That would not follow.
If the Minister will consult his advisers he will find that in recent years, before Mr. Reynolds was appointed chariman, the chairman on many occasions produced proxies to out-vote proposals submitted by single stockholders on behalf of a large number of shareholders.
Proxies given him by shareholders.
On behalf of single stockholders. I think it is on record that at a very largely attended meeting of shareholders held in the Gresham Hotel the directors were out-voted. I could not argue against the Minister's contention.
Does the Deputy ever remember a card vote at a trades congress meetings?
I think I do.
Mr. Corish
There is no parallel.
The representatives of different unions are there and they can listen to the arguments. Particular individuals went around to convents—I know perfectly well that directors of railways and of the transport company have gone to converts—and by that undemocratic method secured the signatures of Reverend Mothers when these nuns has no more idea of what was going to happen than the man in the moon. At a meeting the business is explained and Mr. So-and-so gets signatures representing so many shares. No matter how sensible proposals against the existing board may be, the latter have the necessary proxies and can out-vote anybody else. It is because I believe that the Bank of Ireland has a controlling influence in the nomination of directors and in the proxies that are sent out year by year, that I am opposed to any further facilities being given for the continuance of this out-of-date system. I should like to know if the Minister, in view of some words that he used when speaking earlier, was indicating that the Government has under consideration certain proposals for the amendment of the Act of 1845. Am I to understand that the Minister is giving consideration to an amendment of that Act?
I think that an amendment of company law is overdue. I am not promising to introduce an amendment at a particular time, but the need for amendment of that law was recognised long ago.
On the eve of January, 1945 it is time that legislation should be brought in to amend the Act of 1945.
The Deputy will understand that the the only question that arises in regard to this section is that a person acting under his own name can appoint a proxy.
That is the point we are anxious to get at. We are not interfering with a corporate body. The Minister referred to trade unions, but at least they get an agenda and resolutions beforehand. Even in the largest unions. there is a form of discussion amongst the members before authority is given to exercise the card vote. What opportunity is given in the case of banks acting as trustees, who control railway companies? The funds they represent are considerable because the banks give power to whoever they select. That is a very considerable power. I have never attended such meetings, but from what I learned from those who were present I understand that it is a common feature to have three large blocks of proxy votes, and these can control the business. The Minister may be right in saying that we are not dealing with company law here. This is not company law as I understand it. When dealing with an ordinary commercial company in which people invest money there is a legal enactment by which the proper transaction of business is secured. Here we are dealing with public interests of a financial and political nature. Surely it is not right to allow such a situation to develop as happened at the annual meeting three months ago.
Is the Deputy anxious to have the power of proxy abolished altogether?
No, only in so far as you are putting in a special section in the Bill dealing with it.
This does not merely relate to a corporate body. It relates to any stockholder who, for reasons of illness or absence from the country, has his business conducted under power of attorney.
Will the Minister in the new scheme consider giving proxy voting power to the chairman, who is his nominee, and who indirectly is not responsible to this House?
The Deputy appears to be acting on the assumption that only directors can get these proxies. Shareholders can give proxies to anybody. They could give them to the Deputy. The fact that shareholders prefer to give proxies to directors, no doubt is an intimation that they have confidence in the directors. It is not obligatory on them to give proxies to anybody.
The Minister knows perfectly well that we had one recent experience where two or three representatives of what are called single stockholders organised others who gave them their proxies, but they were outvoted by the power of those people who represent the banks.
By the majority.
The Minister is confusing individual shareholders with the actual number of shares. There was a majority of shareholders present but a minority in voting power.
A majority of those present might easily arrive at a decision which the majority of the stockholders would not approve of. It is not proposed to give a large stockholder equal voting power. His vote relates to his holding of stock.
The point is that a large amount of stock is controlled by people who are trustees and, by virtue of that, can give such power to individuals as is sufficient to give them control.
Some of the trustees may be prominent religious people. If they do not attend to exercise their proxies I think this is not unreasonable proposal.
If the public policy point of view is to be represented by the chairman in the future, and if directors are not to be people having the power of office boys, why not change the system and give the prexy voting power to the chairman?
It could be that he would get it.
The amendment does not state so.
What the Deputy wishes might happen.
Amendment put and declared lost.
Section 33 agreed to.
SECTION 34.
I move amendment No. 48:—
To delete sub-section (1) and substitute the following two new subsections:—
(1) The directors of the company may close the register of the transfers of common stock for a period not exceeding 21 days previous to each ordinary meeting and each meeting of the directors of the company at which it is proposed to consider the declaration of an interim dividend.
(2) The directors of the company may close the register of transfers of debenture stock of a particular issue for a period not exceeding 21 days previous to any day on which interest on that debenture stock is payable.
Provision has been made for the closing of the registers of the transfers of common stock for the period of 21 days previous to each ordinary meeting. I do not know if it will ever happen that the company will be in a position to consider the declaration of an interim dividend, but, as a necessary provision in case such a situation should arise, it is desirable that the company should have power to close the registers for 21 days prior to the holding of the meeting at which the question of the declaration of an interim dividend might be considered.. Similarly, there is at present no provision for the closing of Debenture books and it is considered opportune to have that position clearly defined in the case of debenture stock as well as in the case of common stock.
Amendment agreed to.
I move amendment No. 49:—
In sub-section (2) line 42, to delete the words "some daily newspaper published in Dublin" and substitute the words "in every daily newspaper published in Dublin and Cork"
I do not understand why power is sought to give some daily newspaper in Dublin a special privilege.
That is the usual provision, but in practice the advertisement appears in all papers. If the Deputy attaches importance to the matter, I will not fight him on it. The practice would be in accordance with his wishes. I am dubious about the wisdom of prescribing "every daily newspaper published in Dublin and Cork", because, while we probably would know the daily newspapers published, it might happen in certain circumstances that somebody might claim to have a daily newspaper about which we did not know. I should imagine that is the reason the section is worded as it is. However, if the Deputy will leave the matter over, I will accept his point in principle, subject to its consideration by the Parliamentary draftsman. What the Deputy means is that the advertisement should appear in all the known daily papers, but that particular form of wording might not be suitable.
Amendment, by leave, withdrawn.
Section 34, as amended, agreed to.
SECTION 35.
I move amendment No. 50:—
In sub-section (1), to delete paragraph (b) and insert the following new paragraphs:—
(b) three directors appointed by the Minister, and
(c) three directors (in this Chapter and in the Fourth Schedule to this Act, referred to as "stockholders directors") as is provided by the said Fourth Schedule.
This section is one to which the members of this group are violently opposed. I do not know if any sound argument, can be put forward as to why the chairman is put practically in the position, if not in fact in the position, of a dictator. It is quite true that the section makes provision for the appointment of a person "under this Act referred to as the chairman" and that the appointment of other directors known as stockholders' directors, is also provided for. Under the provisions of the different sub-section, it is quite clear that although the other six shareholders' directors are given the title of directors, in the opinion of this group, they have no power other than that of office boys.
Anybody who read the early industrial history of Italy during the period after Mussolini came into power may be able to find argument to justify this proposal. I have recently been reading the Report of the Vocational Organisation Commission, which gave very interesting information regarding industrial organisation in almost every country in the world, and I could read extracts from sections of that report dealing with the history of industrial organisation in Italy to justify, if I wanted to do so, the putting forward of a proposal of this kind.
The Minister in a previous discussion put forward certain arguments in favour of the appointment of stockholders' directors, but this group is not satisfied that there is any necessity for the appointment of stockholders' directors, especially when these people are not given any power except the right to draw very generous fees at the end of each year. I hope it is pertinent to point out that the stockholders' directors who have occupied the position of directors since Mr. Reynolds was elected chairman are the very same men, with one exception, one director having died, whom the Minister holds responsible for the mismanagement and bankruptcy of this concern. If these are the people responsible for the bankruptcy of the transport industry, I do not think it should be made possible for them to retain their positions on the board. The amendment enables the Minister to appoint a majority of the members of the board.
The Minister did make the point on Second Reading that he thought it was impossible for him to ensure that the transport policy of the Government be put into operation by any more than one person; in other words, he seems to think that it is only through the agency of the chairman, with the powers given to him in these clauses, that the transport policy of the Government could be put into operation. He repeatedly stated that from his experience and the experience of the Government in relation to the management of other concerns—I presume the Sugar Company, the Agricultural Credit Corporation, the Turf Development Board and other boards on which Government nominees have been put —he has some reasons for believing, although he did not give them to the House, that these concerns have not been as well conducted as the Minister and the Government would wish.
I did not say that and do not want to be taken as saying that.
I do not know anything about the internal working of the Electricity Supply Board, but there seems to be general agreement in the country that they have been doing their job fairly satisfactorily. I think it is true, and I say it without meaning to be provocative, that a number of the persons appointed to the boards of concerns such as those I have mentioned were appointed not altogether because of their qualifications or experience in the commercial world, but because of their political affiliations with the Government Party of the day. That applies with equal force to the previous Government——
And will apply to a Labour Government if and when it is created.
——in relation to the appointment of nominees to the boards of State-subsidised concerns. If you have a chairman who knows his job, who knows how to handle the finances of a concern and he assisted, as the amendment proposes, by three other persons nominated by the Government who believe in the same policy, I do not see the difficulty in carrying out Government policy. The idea of having directors representing the stockholders of the company who are said to be responsible for the mismanagement and bankruptcy of the transport industry in the past is something which should by cut out, but not alone is it not being cut out under the terms of the section but the same provision is being made for the future as exists at present. It is possible under the section for shareholders to appoint a director who recently came under public notice in another place.
I move to report progress.
Progress reported; Committee to sit again to-morrow.
The Dáil adjourned at 9 p.m. until 3 o'clock on Thursday, 28th September.