Dáil Éireann debate -
Thursday, 23 Jan 1947

Vol. 104 No. 2

Private Deputies' Business. - Control of Prices—Motion.

Mr. Norton

I move motion No. 1 on the Order Paper:—

That Dáil Eireann is of opinion that in relation to many essential commodities manufacturers and distributors are in the habit of charging exorbitant profits and that therefore the selling price of such commodities is excessive, and accordingly considers that the Government should forthwith introduce proposals for the purpose of securing effective control over profits and prices.

I move this motion, Sir, because I think the subject of price control in this country is a problem which affects each and every member of the community and, in particular, affects the large masses of the wage-earning classes and those who live on static incomes, as well as those who are dependent in a very high degree on the meagre and altogether inadequate assistance which they receive under our ill-developed code of social legislation. The rapid increase in prices and the continued maintenance of a high price level for the unfortunate persons in these categories means for each of them a consequential debasement of their standard of living, an impoverishment of their social conditions and results in forcing them to accept new low concepts of life and a low standard of living generally.

I do not want to approach this motion in a political way nor from a political standpoint. I do not want to make Party capital out of the motion, out of the problem, or out of its solution. I merely want to view the question of price control in its economic setting and to view it solely as an economic problem and as constituting a challenge to our legislative and economic policy to control prices in a manner which will give satisfaction to the community in the circumstances under which the community is compelled to live to-day. At the outset I think I can say that there is general agreement among all Parties in the House on one aspect of the matter— that is, that since 1939 prices have risen substantially in this country.

Nobody can deny that is a fact. The Minister for Industry and Commerce has been compelled to acknowledge it. Perhaps those of us who are not in the Minister's Party take a more serious view of the rise in price levels than does the Minister. He may endeavour to find a vicarious consolation in the fact that prices have risen to a greater extent elsewhere. But the fact remains that we are conditioned by circumstances in this country and our destiny is cast here. We, with the resources which we have at our disposal, have to fashion a life for ourselves here and, in the circumstances which we find ourselves, the problem is a serious one for our people.

The cost of living has risen by 70 per cent. over the 1939 level. I noticed that the Minister said in a recent speech that the cost of living had in fact risen less than the index figure indicated. He made that statement based on an examination of what it would cost a working class family to live on the basis of eating the quantity of foodstuffs made available by a rationing scheme calculated to restrict the quantity of foodstuffs and other commodities which go to make up the computation of a family budget. I do not think the Minister's conclusion in that respect is a sound one. Looking at the problem from a broad angle he might possibly draw a conclusion of that kind, but I frankly think it is not a sound conclusion and I do not think it will bear examination in the light of a fuller analysis of the whole problem of price control, the problem of consumption and the quality of the goods available.

It can be said and it can be proved that as a result of the inferior quality of the goods sold to-day it is now necessary for our people to buy those goods with a greater frequency than heretofore. While the percentage increase in the weighted averages, which constitute the cost-of-living index figure and which are used for the purpose of ascertaining the extent of the increase in that figure, may not be as high because of the rationing scheme and the non-availability of goods in their previous abundance, the fact remains that such goods as are available have to be bought much more frequently than was necessary when similar goods of better quality could be purchased heretofore.

I do not think anybody in this House or anybody in the country can deny that so far as the masses of the people are concerned they have now got to buy boots and shoes—certainly in respect of children—much more frequently than heretofore because of the poor quality of the material at present available for the manufacture of boots and shoes. Anybody who has experience of having boots and shoes repaired for growing boys and girls will recognise that, whilst you could expect the repaired boots and shoes to last a certain period before the emergency, they last for a much shorter period now. The same can be said of various articles of clothing. It can certainly be said in respect of many articles of male underwear. Therefore, if one says that the index figure has not risen as high as is actually indicated because of the imposition of a rationing scheme, that is more than counter balanced by the inferior quality of the goods now available and by the fact that the workers and others have to replace those goods with much greater frequency to-day.

Whatever may be my views on that matter vis-a-vis the views of the Minister, the fact remains that we have now to face the position where prices have risen by 70 per cent. over the 1939 level. What the Minister has got to bear in mind is that these prices have risen to that high level while the Government was claiming that it was implementing a policy of price control.

I am prepared to give the Minister credit for having a very considerable volume of energy, of having vision and a high degree of courage in matters of this kind but I am not prepared to give the Minister a certificate of infallibility in the matter of price control nor do I imagine that he would claim entitlement to such a certificate. I am driven to the conclusion that it is the fallibility of the Minister's methods and the course of action on which the Government has embarked that has produced the present price difficulties for our people.

Let us review the position, because some brief review of the position is essential to a proper appraisal of the difficulties which confront us. In 1940 we had a declaration from the then Minister for Finance that the Government was going to set its face against the efforts of any section of the community to get compensation because of the war conditions. That declaration was implemented in the following year, May, 1941, by the promulgation of Emergency Powers Order 83, the purpose of which was to stabilise wages by pegging them down to the then existing level and providing, further, that there could be no increase in wages whatever unless by an amendment of the Order, which could only be brought about by the initiative of the Minister. On the other hand, we had a declaration from the Government of its intention to control prices.

Looking back over the last six years it is now possible to review the position dispassionately, without any heat or rancour, and to see the consequences of that type of approach to the problem. In 1941, we had wages pegged down to the then existing level —there could be no increase whatever without the permission of the Minister —and, on the other hand, the counter-balancing assurance to the masses of the wage-earners that prices would be controlled. From 1941 until a later date wages were definitely controlled, pegged down to the 1941 level and kept at that level rigidly by the Government, in spite of many protestations from the workers that prices were rising. On the other hand, we found this situation developing—and it was a complete departure from the assurance given to the House and to the community—prices were allowed to rise and it was only when they had increased to an undeniable extent that the Government stepped in to control them. We had therefore two entirely dissimilar approaches to a problem which was interrelated. Wages were definitely fixed and prices were capable of rising and it was only after the rise that the Government intervened to endeavour to tie prices down to a particular level. I want the House to note, and I should like the Minister to review, the difference in approach to the problem so far as the wages aspect and the prices aspect were concerned.

We have had up to recently a continuance of that very same policy. We had prices moving upwards and it was only after there had been an upward movement that any attempt was made to apply a check and where the check was applied the usual function of it was to stabilise prices at the level to which they had risen before the intervention of the Government. That evil practice, of course, still persists and it is that practice which has caused and is causing our price difficulties. Our price difficulties will continue so long as we allow prices to rise and attempt to apply a remedy to the problem only after prices have risen.

I need take only two examples to prove the truth of my assertion. Recently the Government feared that the price of potatoes would rise and a Maximum Price Order for potatoes was made. At the time that Order was made potatoes were being sold in many cases at 1/5 and 1/6 per stone. Immediately the Maximum Price Order was made potatoes out of the very same sack as those that had been sold at 1/5 and 1/6 jumped to 1/8 per stone. The effect, therefore, of the Maximum Price Order was a ride-in by those who wanted to get rich quick, to take advantage of the Order to make a profit to which they had no moral right. I attribute that to an error in judgment and a far too generous approach to the problem of profit margins on the part of those responsible for fixing maximum prices in that respect.

There is another example. At the moment housewives are complaining about the recent increase in the price of meat in Dublin. The butchers have decided that they are going to get increased prices for their meat. The Press reported the fact that they were contemplating discussing the matter with the Government. The butchers, with the example before them of others who got rich quick, decided that there was no purpose in waiting for the Government's permission, that the thing to do was to jerk up the price immediately and then discuss it with the Government, not to wait until the Government made up its mind but just to shove up the price immediately, to salt the public and make them pay while the butchers talk to the Government. What happened? Meat prices have gone up by 2d. and 3d. per lb., withcut any approbation from the Government, without any approbation from the Minister, and without any public statement as to why the unofficial arrangement in respect of meat prices —what has been described in the Press as a gentlemen's agreement—has been departed from.

I take it the Minister has given no approval to the increased price. If he has given approval, we ought to hear the reasons. The butchers have decided and, whether the Minister likes it or not, meat prices have gone up and, so far as the butchers can ensure it, they will stay up. If our price-fixing policy runs true to form, what will happen is, that there will be a talk with the butchers and, when the talk is over, meat prices will be stabilised at their new levels. That has been the previous form of the horse known as price control. Probably that is what will be done on this occasion, and the public will bear the consequences.

Another weakness in our original price control structure was the fact that there were inadequate inspections and inadequate supervision by the Department. I make all due allowance for the problem of the Department faced with the task of the gigantic magnitude of price control, a problem in which it was unversed, having regard to the circumstances existing here. I can well see that it underestimated the problem and that it thought the solution was easier than it ultimately proved to be.

The inadequate inspections, in the first instance, the easy-going approach to the problem of overcharging, the long delays in carrying out investigations and the adoption of a policy which crystallised itself in trying to get customers who were overcharged refunded the amount of the overcharge —all displayed a leisurely policy towards price control and overcharging which gave us many of the high price levels with which we have to deal. I do not say that all the faults of our early efforts are attributable to the Government. There is no doubt whatever that, in the early days, profiteering and black-marketing was aided and abetted deliberately by the absurdly inadequate sentences imposed by the courts on people found guilty of notorious black-marketing and gross profiteering at the expense of the community in a time of crisis.

Ultimately, on the basis of trial and error, conditions improved somewhat. There was an increase in the inspectorate staff of the Department and when the machine worked vigorously and adequately, as it did in the latter days and as I think it is doing now, there was a change for the better, but it came too late to undo the real harm. The effort to fix minimum sentences in relation to profiteering helped in its own way, but not until a considerable amount of harm had been done. I believe—and my views are based on consultation with all classes of the community—that the early hesitation in dealing vigorously with rising prices, profiteering and black—marketing produced a lack of public confidence in the price control policy. Undoubtedly, a goodly number of our price control difficulties are due to the apathy of the public, but it was an apathy which our early policy helped to create, and by a continued reliance on that policy, helped to keep alive.

If we are to have effective price control, we must convince the public that the new methods will be much more vigorous. The public saw manufacturers and retailers increasing their prices, they saw the Department belatedly step in, they heard later, through the Press, that prices had been fixed behind the closed doors of the Department, they got no information as to the basis on which they were fixed, they simply felt the consequences of the increase. By constant suffering they felt that their function was to suffer the unpleasant consequences. Public goodwill is essential before any price control policy can be effective. Even now, notwithstanding the many errors in the past, public goodwill can be won, but that is a matter to which I shall return in the course of my remarks.

In the Seanad last week, the Minister made a lengthy speech in defence of his Government's policy of price control. I agree at once that it was an able speech, that it was a comprehensive review of all the developments of the past six years and of the factors which affect price control. Having read the speech very carefully, however, I was forced to the conclusion that it resembled the examination of a very sick patient by a doctor who, after skilfully applying his talents and having unerringly diagnosed the patient's complaint, then eloquently and with a feeling of pleasant hopelessness tells the unfortunate patient that the disability has gone so far and for so long that, much as he would like to do it, nothing really can be done for him at this stage. When the Minister's comprehensive review was over and the Seanad adjourned that night, we were left with the fact that prices are still 70 per cent above the 1939 level. That is the problem we have to face to-day.

Whatever was behind the Government's taxation policy in its early stages or whatever it was capable of achieving, it deliberately aided the policy of high prices. As a matter of fact, there is no more convincing evidence of that than the statement of the present Minister for Finance, that he was now abolishing the Government's taxation policy in respect of profits in the hope that prices would come down. That was the clearest possible admission, in his Budget statement last year, that he realised that the Government's policy of taxation, in the manner in which it was applied, was directly responsible for increasing prices. I can scarcely credit and I will be astonished to hear that the purpose of excess profits tax was to increase prices, but there is no doubt it had that effect.

The mistake the Government made in the imposition of excess corporation profits tax was that in many cases there was no ceiling to profits, though there was a ceiling in some industries. The Government was perfectly satisfied that substantial profits be made, so long as they got 75 per cent. of the excess profits, from those who were exploiting the community for their own enrichment. Not merely was the Government getting the corporation profits tax—which yielded approximately one-third of the total of ordinary corporation profits tax and excess profits tax —but it was getting 75 per cent. of the excess corporation profits tax.

By a continuance of that policy over a number of years the Government was able to accumulate a very substantial sum of money from excess profits tax. One may say it was wise to take those excess profits away from those who had accumulated them. My suggestion is that it would have been much wiser to compel the manufacturers and retailers to plough back those excess profits into prices, so as to maintain prices at a low level and not compel the community to pay exorbitant prices for goods out of the meagre incomes on which they were compelled to exist during the war years.

In reply to a parliamentary question yesterday, the Minister for Finance told me that the estimated return of corporation profits tax this year was £4,600,000 and that, of that sum, approximately £3,500,000 was in respect of excess corporation profits tax. A sum of £3,500,000 will be yielded during the current financial year in excess corporation profits tax—a tax on excess profits which have been obtained by permitting people to charge for goods a price which is quite exorbitant in relation to the cost of production. This sum of £3,500,000 is derived from excess corporation profits tax only. When we probe the question, we find that that tax is paid only by registered limited companies. It is not paid by private companies or by partnerships. When we remember that the registered limited companies were compelled to yield up £3,500,000 in excess corporation profits tax this year and when we remember that the private company and the private partnership were excluded from that tax, we get some picture of the amount the manufacturers and wealthy distributors have made at the expense of large sections of the people who have been tied down during the emergency to the pre-emergency wages, with the trifling increases which they obtained in the form of emergency bonuses.

Whoever conceived the scheme for applying excess profits tax to manufacturers and wealthy distributors who are organised as registered limited companies had a very generous heart, so far as that fraternity was concerned. Look at what we did. If a firm had a capital of £5,000, we said that they were allowed to earn a standard profit of £2,500 before paying any excess corporation profits tax. They were allowed to earn a standard profit equal to half the capital of the firm. In addition, as everybody knows, they charge quite substantial fees as remuneration for directors and the limited number of people directing the activities of the firm. When you think that firms were allowed to get away with these allowances of ordinary profits before a levy was made for excess corporation profits tax, you get some picture of the generosity with which this whole problem was treated so far as the imposition of tax was concerned. Now, we are told by the Minister for Finance that excess corporation profits tax is to go—that, in fact, it has gone. I wonder what the Government's policy will be, with the abolition of the excess corporation profits tax. The Minister made a lengthy speech in the Seanad but he was singularly silent as to what the Government's policy would be in that respect. The only information we have got from the Government, since the Budget introduced last May, was an expression of hope by the Minister for Finance that the abolition of excess corporation profits tax would lead to reduction in prices. How far that hope will be falsified, the next few months or weeks should tell. I should like to learn what the Government now intend to do, following the abolition of the excess corporation profits tax. Are all these firms to be allowed to put into thier own coffers the profits which in the past, they were compelled to yield up under the game—and it has all the appearance of a game because it is not restrictive or rigid legislation? They got away with a certain amount of swag and yielded up a proportion of that swag to the Government, which legalised the arrangement. I hope the Minister will be able to tell the House —he did not tell the Seanad—what the Government proposes to do to ensure that the abolition of the excess corporation profits tax will not make well-todo people richer at the expense of the mass of the people who are finding it hard to exist on their present income levels.

I want to refer, particularly, to the drapery trade and its associated activity, the household-goods trade. Those two trades are, in the main, amalgamated into a single activity. The Minister was at some pains not merely in the Seanad but here on previous occasions to explain the profit margins on which prices were based. He explained that these margins were only reasonable. I put this to the Minister not in any acrimonious way but as a subject for reflection: does he not think that there was something seriously wrong with his margins in the drapery trade when he was compelled to intervene on two occasions and reduce the margins which he had at first fixed? The Minister fixed a margin. Then under pressure by the public, he went in and cut that margin. A new margin was fixed. That held the field but still the public complained that it was too high. The Minister went in again and cut the margin. Having been compelled, by force of circumstances, to cut the margin twice, without, so far as anybody can see, public protest or violent indignation by the drapers or any threat to close their business, does he not now think that, when he was fixing the profit margin in the first instance, he very much overshot the mark and gave to the trade a much more generous allowance from profits than the facts and the circumstances warranted? Does not everybody know what is happening in the drapery trade? I should have thought that that trade would be one with which the Minister, because of his specialised knowledge, would be particularly familiar, but the fact of the matter is—and nobody in this House can gainsay it or deny it and the speeches we make will not deceive the people—the drapery firms are richer than they ever dreamed they would be. Anybody who takes the trouble to go to Dublin Castle, look at their balance sheets—they can be got, I think for 6d. —and compare their profits from 1936 to 1939 with their profits to-day will be astounded as to how wealthy they have got.

For them the war has been a godsend and the emergency a Klondyke. They have got richer than they ever dreamed and are getting richer still, while the masses of the people get poorer. Those engaged in the drapery trade in a big way, either as wholesalers or distributors, are getting rich in spite of themselves. Take, as an example, the way in which money was spent on advertisements during the war by drapery firms that could not afford an advertisement before the war. You had many of them shoaling out money on advertisements. Why? Because it was cheaper to put advertisements in the newspapers to keep their names before the public than to have the Government taking 75 per cent. of it in the form of excess profits tax. You had advertisers queueing up in every newspaper office in the country. If one asked to have a large advertisement inserted, one had to take his place in the queue. When you inquired as to the source of those advertisements you found that they were from people who had done well during the war, as their balance sheets revealed.

There was no tightening of the belt so far as they were concerned. There was more and more going into their purses at the expense of the people, even after the Minister first started off to restrict their profit margins. He had to come back and have a splash at them, and had to come back a second time. These are the folk who are doing well. You have only to look at the advertisements in the newspapers to realise that. You find drapery firms advertising in the newspapers saying that the controlled price of this or that article is so much, but that their price is so much less. One can see a reduction made between the maximum controlled price and the selling price. In some cases it was as much as 30 per cent.

Firms are not just in business from motives of philanthropy or charity. These drapery firms did not put advertisements in the newspapers, with advertising costs what they are to-day, merely to tell the public that they wanted to give an article away without profit, nor were they going to meet the expense of telling the public that the article was available without profit. All that has been done because there is still a good margin there, a good embroidery of profits, and it is on that margin that the drapery firms are getting wealthy to-day.

So long as you have a situation in the country in which after two reductions in price margins in the drapery trade, you can still get firms to say: "The controlled price is so much—do not mind the Minister who fixed it— we will sell it to you at so much less," how can you create public confidence in a price-fixing machinery or in a price-fixing policy in which crystallises itself in happenings of that kind to-day when the people are protesting against the high cost of living? I want to say deliberately that every draper and manufacturer of drapery goods in this country as well as other firms engaged in the production of household goods, continue to make and have made enormous profits out of the war. If anybody cares to examine their balance sheets he will find that to be a fact. Not only have they made enormous profits during the war but they did so in the main by buying a lesser quantity of goods and on the sale of inferior articles when compared with 1939 standards, at 1946 prices. Many of those firms in the normal halcyon days of peace could not pay dividents. A meeting of their shareholders was like a wake. There were long plaintive lamentations from the directors who were not able to indicate that any profit had been made, and who could only say that the profits available for distribution were so small that an investment in the business was a dead loss.

Anybody who cares to read what used to be the annual wails of chairmen of drapery firms can find that fact confirmed in abundance. That was the position in the pease days when you had normal prices and the normal clash of competition. It look a war and the sacrifices of millions and millions of human lives, with scenes of devastation that are incomprehensible to the human mind, scenes of slaughter and desolation, to enable those people to lift their businesses out of a bankrupt position into the position in which they are now. They are doing very well as the stock exchange value of their shares clearly indicates.

In the Seanad the Minister said, and I was rather surprised at this statement from him, that "quality for quality clothing was not dearer here than in Britain".

Mr. Lemass

I did not say that. I said clothing produced here.

Mr. Norton

I have not got the actual reference, but I accept the Minister's interpretation. The Minister says that clothing produced here is not dearer than clothing in Britain. I believe it is. I have personal evidence of the fact that it is much dearer here. You pay 25/- or 27/6 here for a shirt, a raggy inferior looking article. You can get a much better shirt in Britain for 12/6 or 14/6. I suggest to the Minister that the next time one of his officers is in London he ought get him to buy a 15/- shirt there, and then compare it with what you can get in this city for 15/-.

I have seen shirts marked in Dublin shops at exorbitant prices, at a price at which you could get a suit of clothes before the war. What price will you pay for a decent shirt here? A gentleman told me that he paid £2 5s. for one. I said that he was a bit of a fool to pay such an exorbitant price. His reply was: "What could I do; I could not wear the raggy-looking article that was available at a lower price." Tailors advertised suits for 50/- before the war, and it now costs £2 5s. od. for a shirt. That is the price charged by drapers who, according to themselves, are being unfairly treated. Compare the price of shirts here with the price of shirts in England or Belfast. We do not make the cloth, but compare the prices. Compare also the price of pyjamas here and in England or in Belfast; compare the price of ties or of socks there and here. The quality of their articles is very much better than the quality of the articles for which we have to pay a higher price.

I am willing to subject that statement to any test that the Minister cares to impose in respect of it. I am prepared to have it tested by an officer in his Department and to accept the verdict unquestioningly so long as he allows me to tell him what shops to go to in London—so long as he does not go to buy in Bond Street or spend too much of his time in places like Austin Reed's. I want him to go to the shops where the generality of the people make their purchases, to shops outside the West End of London. If he does, he can get any of those articles very much cheaper there than he can get them here. I think my statement on that is beyond contradiction.

I met a number of visitors who were over here from Britain during the war. They were amazed at the ease with which they could buy clothing. They said it was lovely to see the shops stocked with clothing. Many of them remarked that it was very easy to get coupons, too. They said our goods were frightfully dear. They said: "Our difficulty is that while your goods are dear we have no coupons to buy our own goods except in very limited quantities and on a very restricted basis." Consequently, they bought our goods here. They were not attracted by the price. but they were attracted by the availability of the goods. They could not buy the goods in Britain because they had not the coupons, and it is not easy to get coupons there. I want to say to the Minister that, if he will leave his own feelings out of this matter and forget that this is a matter in which his own dignity is affected and his own prestige involved, and instead will talk to the generality of the people who have to buy drapery goods and household goods, he will be able to get the view that I have stated from those people, and they cannot all be wrong. That is, when you go into a draper's shop, money simply melts. So far as the ordinary working-class people are concerned, their money lasts no time in view of the prices they have to pay for clothes and household goods.

In Catholic families young children have to be prepared for First Holy Communion and Confirmation. These are events which, as Deputies know, hold a very high place in the religious conceptions of the masses of our people. Every possible effort is made by the parents to ensure that on these occasions the children are appropriately dressed.

At any time the provision of clothes for children participating in these religious services was a bit of an ordeal, the raising of the necessary money in order to buy clothes for the children presenting certain difficulties. In recent years it was something impossible of attainment on the original basis. If you go into a shop now and try to buy for a boy a suit of clothes, stockings, a shirt, tie and a cap, it simply takes a few weeks' wages to do it and the family is impoverished until it can repay the loan raised for the purchase of these articles.

I should have thought that in his speech in the Seanad, which in many respects was a realistic speech, the Minister would have shaken himself free from what I think, on close analysis, was a rather complacent view of the prices situation. Apparently, in an effort to feel himself, and to convey to others, the view that present price levels are no occasion for disquietude, the Minister gave utterance to this view: "There is no historic or economic theory that falling prices are good for the workers." I would like to put in juxtaposition with that revealing statement from the Minister this question, which I hope he will answered: Are rising prices good for the workers, and are rising prices good for the workers when they are compelled to exist, as they are to-day, on shrunken wage standards? That represents the position of the masses of the people in our community. So far as the workers are concerned, we now find ourselves in the position that an entirely new problem is confronting us, a problem dissimilar to any of those which confronted us during the emergency.

In recent months, since the Wages Standstill Order went with the repeal of the Emergency Powers Act, the workers, through their trade unions, have been demanding increased wages. There is nothing unusual in that course; it is just the natural reaction by the workers from a policy of pegging down their wages, a policy which debased their standard of living, a policy which, comparing 1946 with 1939, showed itself in this form, that there were less clothes in the workers' houses in 1946 than in 1939; there certainly were less bed clothes there, because of the prices charged for bed clothes in the intervening years; there was less furniture there, less household equipment there and the general standard of the household had seriously declined in 1946 as compared with 1939.

Workers are now endeavouring, with the assistance of their trade unions, to regain at least the pre-1939 standard of living. Their efforts to secure wage increases represent a manifestation of that policy. Concurrent with the demand for increased wages is a fear that although their wages may be increased they will yet be cheated out of the benefits which ought to accure to them from a policy of increased wages. There is a new fear manifesting itself among the workers and manifesting itself with good cause, that although their wages may be increased as a result of the efforts of their unions, those who got rich at their expense during the past six years will continue to get rich and will become richer because of the Government's repeal of the excess corporation profits tax, a lifting of the seal so far as their rapacity is concerned.

At this stage the Minister and I differ. The Minister thinks the increase in wages will not result in an increase in prices.

Mr. Lemass

I did not say that.

Mr. Norton

Perhaps that is not a fair interpretation of what the Minister said. The Minister said that an increase in wages will not produce a proportionate increase in prices. I will read what the Minister said in the Seanad, so that there will be no possibility of misunderstanding:

"There is no reason why prices should increase proportionately. There is no reason, in theory or in practice, why there should be that result. I have shown that the increase in earnings since 1943 has not affected our price level, that the general price level here did, in fact, show a slight decrease in the past year, although there was in that period an all-over average increase in industrial earning of 7 per cent."

One could underline "industrial earnings" and calculate how much that plays in price levels in certain industries. The Minister made that declaration after he had confessed earlier that he had read many economic textbooks and had told the Seanad what the recognised economists' remedy was for situation relating to inflation and insufficiency of goods available with a superior volume of money to purchase them. That was the Minister's view in the Seanad.

Let me quote another view in the Seanad, expressed there with some relation to the man's association with business methods and with a knowledge of what happens on these occasions. Senator Summerfield spoke in the debate. I understand he is associated with the Federation of Irish Industries or the Federation of Irish Manufacturers. At all events, he has wide commercial interests in the city. I think he is actively associated with that body. He certainly knows what the manufacturers are thinking, he has a fair knowledge of what they do, and I suspect he has an idea of what they intend to do in respect of these wage increases. I need not theorise further or put my point of view against the Minister's. I put the Minister on the one hand and let Senator Summerfield, the industrialist, come in on the other hand. He puts no tooth on what happens on these occasions. He said:

"The present demands are jumping the wages of craftsmen up from £5 per week to over £7 per week. That extra £2 per week which is imposed on the employer must go— there is nowhere else for it to go— into the price of the article that he sells or handles. We should have some realism in all this. The Minister brought realism into it. He dealt with the various aspects of this question in a very exhaustive way. I think I can claim that anything that I have said has been uttered as a results of my experience and has not been got from textbooks. What I have said was certainly not founded on theories but on fact. The facts that I have mentioned affect everybody in the community, no matter what a person's station in life may be."

Senator summerfield did not go to the textbooks at all. He did not want any recipes as to what to do when inflation is near or any recipe as to what to do when prices are going up. He had learned in the hard school of experience that, when wages go up from £5 to £7, there is only one place for that £2 to go and that is to stick it on to the price of the article which is handled or manufactured by him—not a tooth in it. There it is, in all its nakedness. I do not think in this matter he is wholly out of step with manufacturers and large distributors in their approach to a problem of that kind.

It is Senator Summerfield's frankness in this matter that has disturbed me and disturbed the trade unions much more than they have been previously disturbed on this whole question. If Senator Summerfield is speaking for manufacturers—and, mind you, I suspect he is; the Minister would hardly say that he is the critic of the Government, certainly not a strong critic; in the Seanad he has spent quite a considerable amount of time in indulging in praise of the Minister and the Government's attitude—Senator Summerfield says with brutal frankness that there is no other place for wage increases to go except to stick them on to the price of the article which he manufactures or handles. I think even now the Minister might pause and think that there is some ground for the feeling that a very substantial proportion of the wage increases at least will go on to the price of manufactured or distributed goods.

It is the experience of the past, it is the hard experience of Senator Summerfield and the knowledge which many of us already possess of the results of wage increases, that cause me and many people like me to fear that increases in wages will be utilised for the purpose of increasing prices and thus cheating workers of the benefits of wage increases. I do not know whether anybody in this House is familiar with what happened in the printing industry. There employers with delightful frankness and freshness will tell you that as wages have gone up, they regret that they have to increase their prices—not a tooth in it. I suggest to the Minister that he should examine some of the profits made by these firms and he will find that they have gone up by 100 per cent. as compared with 1939. I cannot reveal all the information in my possession but I suggest that the Minister should make some investigations and I shall help him with some facts if he does so.

Let us leave Senator Summerfield and come to the General Manager of Coras Iompair Eireann. Giving evidence yesterday in respect to claims for increased wages he said:—

"As regards the ability of the company to pay increases, Mr. Lemass said that rail losses were serious and increased fares and freight rates would be necessary and at such a rate that they would further increase the cost of living and result in loss of business for the company."

There are two entirely dissimilar persons—one a legislator, the other a man managing a national transport service but both coming to the same conclusion—that these wage increases are going to be piled on to the price of goods and the cost of services so that the community will be cheated out of whatever benefits flow from increased wages.

I suggest to the Minister that at this stage, at all events, we have got a new problem, one that we have not had to face before and one that is challenging us now. Our capacity to handle it, and the speed and efficiency with which we handle it, will determine in a very large measure our future industrial development and the degree of stability and prosperity to which this country can attain within any measurable distance of time. If we are going to have a situation in which the price of goods is going to go up and the cost of services is going to increase still further, then inevitably the trade unions will come back again and again looking for more wages because they are not going to tolerate meekly a situation in which prices are constantly jumping ahead of wage levels and in which their members are left in a position in which they are unable to meet the increased cost of living. Every rise in prices in future is going to give rise to more and more demands for wage increases. That is the most logical development possible from the standpoint of the workers organised in trade unions.

I suggest to the Minister that we ought to pause at this stage and consider what is the best policy to adopt in the situation confronting us. Here I want to make some suggestions to the Minister and I make them not as an infallible recipe for our difficulties. I make them not in any sense of selfconceit. I make them purely for the purpose of contributing my quota to the solution of a problem which must be faced unless we are to have a still more serious problem in future.

I suggest to the Minister that prices must be pegged at once and that nobody should be allowed to increase existing prices. That was done in 1941 in respect to wages. If we could do it in respect to wages in 1941, why cannot we do it in respect to prices in 1947? All these demands for increased prices from butchers and everybody else should be stopped and price levels should be pegged at once. No more increases should be permitted and all these folk who are now looking for increases in prices should be told that just as the workers made very heavy sacrifices from 1941 to 1946, it is now their turn to make sacrifices. When the workers' wages were pegged in a very large measure during that period, these traders were permitted to make exorbitant profits as indicated by the level of contributions which they made to excess profits taxes. They should be told now to meet wage increases out of their accumulated profits. There is no doubt in the world that they are capable of doing that for a long period to come. In any case, if they feel that notwithstanding an Order to peg the prices level, they are unable to pay wage increases on existing price levels, they should be compelled to go before a publicly constituted tribunal of eminent people in whom the nation has confidence and there, in a public way, be compelled to justify before that impartial tribunal any claims which they make for increased prices so that the public, with a sense of confidence in the tribunal and an inherent desire to be fair, will know whether the case for increased prices had been proved.

Let the tribunal so constituted advise the Government whether a claim of that character has been substantiated. A tribunal of that kind, assisted by experts capable of examining all the accounts of the firms or industries in question, would at once examine this whole question at price control in a manner that will arouse public interest and that will bring home to the public the realisation that an effort is now being made effectively to control prices, and in that way to win the co-operation of the public, so sadly absent in the past, for a new effort to fix prices at a level within the ability of our people to pay. But that, in itself, is not sufficient. Simultaneously with the implementation of a policy of that kind, there should be an examination as to the best way in which the excess profits already made and which are now being made can be ploughed back into the production and distribution of goods and services in such a way as to produce a lower price level than that which exists to-day. In Britain, local prices tribunals were established and their biggest critics will admit that they did an excellent job of work. These tribunals were representative of local people of standing, including consumers. It was possible to make a local complaint to a tribunal and the complaint was investigated, and, if the complaint was substantiated, a prosecution was instituted by the tribunal. There was a speedy and ready method of punishing local profiteering and overcharging. In that way, through the medium of these tribunals, very valuable assistance was given, so far as the public was concerned, and a very valuable contribution was made by these tribunals to the control of prices locally.

I believe that, notwithstanding what the Minister said in the Seanad, there is a wide degree of public co-operation available for an actively-pursued price control policy, and I suggest that one of the ways in which the Minister might well beget that public good will and co-operation is by establishing some type of committee generally representative of either Parties or crosssections of the nation to advise as to the best method by which exorbitant profits can be eliminated, so that they can approach this problem not in a Party spirit and not in any feckless way that necessarily goes with throwing a matter into a purely political arena, but from the standpoint of trying to get the good will and the combined wisdom of all Parties for an effort to eliminate the present profiteering and to bring prices down to a level within the capacity of our people.

There is, with the problem of the distribution of goods, an equally important problem, an allied problem, the problem of increasing production. I know of no two problems which could better be tackled by a committee of the character I have described, because if we are to attain a decent standard of living in this country, we can do it only on the basis of paying the best standard of wages the nation can afford, of giving the best code of conditions the nation can afford and by producing, at the same time, a greater and ever-increasing volume of wealth for distribution amongst all our people. A nation does not live on its deposits in the bank. It lives on what it produces and there is nothing else on which it can live. A committee charged with responsibility for eliminating profiteering and black-marketing, on the one hand, and advising and aiding in the stepping up of production, on the other, would, in my opinion, make a very valuable contribution to the growth of prosperity in this country.

At all events, this whole question of price control has reached a point at which it is far too serious to be allowed to get into the realms of acrimonious Party controversy. I should prefer to see the thing tackled by a pooling of the wisdom, the goodwill and the co-operation of people of all political views. We have a choice: we can throw it into the political arena and there make it the football of our political antagonisms, an increasing source of political discord, or we can do the other thing—we can co-operate on a basis of goodwill and a desire to eradicate the unreasonable profiteering and profit-making which exists to-day. But if we are to avoid sinking down to an even lower level of production than in 1939, and, concurrently with that, to have to face the problem of high prices, the combination of both giving us poverty, mass emigration and a low standard of living, the prospect before our people is certainly bleak and despairing.

I believe that undesirable development can be avoided. I believe that that reaction and that recession can be avoided, but I believe it can be done only by the pooling of all our knowledge, all our wisdom and all our resources. I believe that if the Government approach the matter in the spirit of being anxious to avail of the goodwill and co-operation of all Parties, there will be found within all Parties of the House and amongst the people generally that reservoir of goodwill which, if properly harnessed, is capable of providing the ways and means for solving the problem.

I have spoken on this matter not in any political sense or with any desire in the world to make capital against any political opponent. I have been concerned only with the way our price policy has been regulated, and I suggest to the Minister that he might very well use this debate for the purpose of indicating that the Government have in mind some proposals whereby the goodwill and co-operation of all Parties can be harnessed for a national effort to eliminate profiteering and black-marketing and to save our people from the exploitation from which they undoubtedly suffered during the past six years.

Mr. M. O'Sullivan

I formally second the motion.

Dr. O'Higgins

I move the amendment on the Order Paper:—

To delete all words after the word "opinion", and substitute therefor the following:—

"that a serious danger has arisen for all sections of the community due to the high and rising cost of commodities essential to health and life, and requests the Government to take immediate and effective action to reduce by every possible means, including if necessary by subsidy, the cost of the main necessaries of life; and to set up a committee or committees which shall sit in public (1) to examine without delay into the causes of the high prices of the most important commodities in order to prevent profiteering, and (2) to ascertain the steps necessary to bring about a general reduction of prices."

The amendment is more or less in substitution for the motion. It was tabled after a rather close and careful consideration not only in connection with the circumstances which bring about this debate but also in face of the motion before us. We could superficially and spontaneously subscribe to the motion. We certainly would subscribe to the intention behind the motion, to the spirit of the movers of the motion, and, in addition to subscribing in the main to the motion, I could in fact subscribe in the fullest way to the statement of the desires and the intentions of the movers of the motion; but on full consideration it appeared to us that to support bluntly and without examination a motion to the effect that "in relation to many essential commodities manufacturers and distributors are in the habit of charging exorbitant profits" might be a little too sweeping and might, on examination, be found to be unjust. It would look like judging the issue in advance of the court; it would look as if we were going to brand everybody engaged in manufacture and retail distribution in this country as charging exorbitant profits.

We do know that that charge is true against many, but we also know that there are a number of other contributory factors making for the excessively high, the impossibly high, prices which prevail at present. The Government, the Minister's colleagues, is one of the very big factors making for the excessive cost of commodities. There is, for example, the system of collecting ad valorem duties on commodities imported into the country.

It means that if the cost of the material or the article quadruples the duty on that material or article is multiplied by four and the traders' profits—be it a profit of 20 per cent., or whatever is considered reasonable— is calculated at four times the cost price of the article plus four times the previous whole-time duty on the article, with the result that the public is paying for the Government's rake-off four times over, plus the increased cost of the material. In our view the increased cost of commodities—the essentials of life and the essentials of living—is due to a number of circumstances. Some of those circumstances are within our control and some of them are not within our control.

The increased price in the cost of some essential commodities is due to the war and to world conditions generally. We cannot do anything to alter world conditions. The increased price is due also to the customs collected on the commodities, certain of which it is essential for us to import from abroad, and to the principle of collecting those duties on the increased price of the article. To a very great extent it is also due, in my opinion, to the transport monopoly created by the Minister himself and to the wiping out of existence by him of competitive hauliers, organised and unorganised, small and large, and giving the entire carriage of our goods to one immense monopoly which can charge what it likes. Those controlling that monopoly are just as anxious to make their bit and to make it quickly as are any of the people referred to in this motion.

To a large extent the increased cost is due to profiteering—excessive profiteering—and to the lack of control and the failure to exercise proper control by the Minister for Industry and Commerce. The excessive price of certain commodities is also due to the fact that the Minister for Industry and Commerce fixed prices at an unreasonably high level. There can be no argument about that. If it is found as a general rule that the practice is to charge prices considerably lower than the prices fixed and sanctioned by the Minister, then the Department of Industry and Commerce has failed to put a proper value or carry out a proper costing of that particular article. The fixing of unduly high prices by that Department for which the Minister is responsible has the effect of setting a headline. That is accepted as the standard for the trade in general to charge higher and higher prices. That is a contributory factor.

The influx of tourists and the ease with which they can procure coupons and purchase our goods mean that our already very, very limited supply is still less capable of meeting the demand. I think the time has come when a searching examination should be made into the question as to how visitors from the North, from Great Britain, from America and from Timbuctoo, and the far corners of the earth have no sooner dropped out of a plane or been emitted by a train at Amiens Street or a boat down at Dun Laoghaire than they are able to equip themselves much more abundantly with coupons, particularly clothing coupons, than is the ordinary family or the men and women of our own country. That is a matter into which immediate inquiry should be made. It shows the complete lack of control in the coupon rationing system. I myself had occasion to complain here in the Dáil that when our people went abroad—their applications having rested for months in the Minister's Department and for weeks in the Taoiseach's Department —their ration books were never called for or collected from them. That situation obtained for years during the war and well the Minister knows it. That is another contributory factor.

The tourists come in here with an abundance of money, having had no opportunity of spending it in a country that was effectively rationed and where coupons were efficiently controlled. For years they had neither the facilities nor the opportunities for spending money. They come over here and they get a kind of thrill out of the mere spending of money. They do not mind what they pay. Not only do they clean out the shelves of the shopkeepers but they force up prices and encourage those in trade to accept only the highest prices they can get. That is an important contributory factor forcing up the cost of commodities.

Another contributory factor is the type of black-marketeer which we have with us at the moment. He is not the same type of black marketeer as we had years ago, who operated on a big scale by cornering commodities in short supply and subsequently making them available at his own price. To a certain extent that type of black-marketeer could be regarded as a benefactor because he was supplying us with something which we could not otherwise procure. Undoubtedly, he supplied it at his own price but the person who paid his price did so as a free agent. At the present moment we have a completely different type and a much more contemptible type of black-marketeer operating. The essential difference between them is that the present-day type operates in the full light of day, under the shadow of the policeman's baton and under the eyes of the Minister for Industry and Commerce, and no action is taken.

There is one commodity that may not appeal to us here in this House but it certainly appeals to the younger generations of our people. It is a commodity used extensively in the poorer households where there are children. I refer to chocolate. In the trade itself it is a rationed commodity. Within the last six months it has practically completely disappeared out of the confectioners' shops. But in the queues for the cinemas, in the queues for 'buses, and in the queues at Nelson Pillar, you have youthful agents of the black market syndicate quite openly selling chocolate at six times the fixed price and no action is taken. The same experience may be had on our rececourses and up in Croke Park, or at any large congregation. The hawker will sell a packet of cigarettes at the fixed price provided you buy a bar of chocolate with it at six times the legal price.

These things are being done quite openly and these are the things which affect adversely the cost of living and set up an entirely unworthy standard. If we had an effective control of prices and an effective control of the rationing system these are things with which we could deal. The system we have is utterly ineffective. It is inept. It has broken down completely. The Department started off on the wrong foot by telling us here that if we gave authority to fix wages the Department would prevent a rise in prices. We were told that if that authority to peg down wages were not given prices would rise to the highest limits. We were severely and trenchantly reprimanded by the Minister when we suggested that even if he did peg down wages prices would rise as merrily as ever.

I have read every speech made by the Minister and I pay him the compliment of saying that I read them with interest, that they are very able speeches, that he can make a good case even out of very bad material, that he is a man with unique agility in the use of figures, even if it is associated with a certain daring recklessness also with regard to figures. But, he does manage to make a good case even out of very bad material. I have read his speeches defending or explaining or apologising for the excessive cost of living, and I have read these speeches without being impressed. I could see the streak of evasiveness, nearly amounting to dishonesty, running through those speeches. I could see the desire and intention to use figures not honestly but in order to mislead. In his usual buoyant, trenchant manner, he told the Seanad lately, showing the magnificent work that was done by way of control by the Department of Supplies, etc., during the critical years of the war, that control had been such that the cost of living had risen by very little, if anything, more than it had risen during the last war.

Mr. Lemass

Much less than during the last war—very much less.

Dr. O'Higgins

Actually less than during the last war.

Mr. Lemass

Very much less.

Dr. O'Higgins

The words were true and the statement was fairly accurate but the implication was entirely misleading. Those of us, family people in this country, who went through the last war remember that the policy here and elsewhere was a policy of big money, of high prices and high wages. Nobody —workman, farmer or anybody else— cared what an article cost because up went wages and up went incomes. Here, during this war, we had a system whereby wages were pegged down and prices went up practically to the same level as in the last war. There was no attempt to control prices in the last war, either here or abroad There was no such thing as a Department of Supplies to control prices. There was no such thing as rationing except in one or two commodities and, with regard to them, it was carried out with the greatest humanity. But here, we had not to fight a war. We were doing our best to prevent anybody going abroad to participate in that war. We had nothing to do but manage our own affairs in this little island sod of turf and we were not able to do it with any degree of success. The result was that the cost of living officially went up 70 per cent. but any housewife or mother would certainly claim that the cost of living went up far more than 100 per cent. because there are articles that must be bought in every household, sometimes week after week, that are not even reckoned when calculating the cost of living index figure. But, say that it went up 70 per cent., that may not matter a whole lot to the Minister but it mattered a great deal to the person trying to exist on a fixed small income, the person on a small pension, the feeble or delicate person endeavouring to exist on a small annuity, the working head of a family endeavouring to exist on a comparatively small wage.

I consider that the most useful function that every one of us could have been carrying out during the war, instead of trailing our coats and strutting around as a warrior nation, was to have spent all the energies and all the surplus money that we were spending on aping the militarism of powers gone mad, on internal organisation of the marketing arrangements in this country. Then we would have left something good after a very evil period of years. What contribution was made by Government towards organising, even to the slightest extent, the marketing position in this country, the internal arrangements of marketing. Every one of us remembers two or three occasions in recent years when we had something like a potato famine in the City of Dublin, when supplies were not anything like equal to the demand, when the price rose to famine level, when the Minister and every one of us knew that 40 miles away, in Longford, Offaly, Roscommon, potatoes were lying there rotting and unsaleable. In a tiny little island, is not it an extraordinary situation that you should have the population of the capital going without a regular article of food, traders charging ten prices for the article, while unlimited quantities of that article were rotting 40 miles away because there was no marketing organisation, when lorries were tearing up and down the roads staffed by soldiers, empty—and that thing placidly tolerated and perpetuated and apparently to remain for all time? Surely the Minister would have contributed something, not only to making life more worth living during the emergency and reducing costs during the emergency, but also to making life more reasonable for the years to come if, during those years, with all the extraordinary powers with which he was vested, he had organised some scheme of internal transport and marketing of the goods we produce.

Examine closely the lunatic system that prevails between the farmer who produces vegetables and fruit and the consumer who buys—a whole row of men daily taking their rake-off, with the result that an article which is comparatively worthless down on the farm, such as apples, is one of the most expensive commodities that can be put on a Dublin table. Surely there is some scope for the Department there? At the present moment, in a country district, if four or five big turnips fall off a cart on the roadside, those turnips are so valueless that it is not worth the time of the labourer to stoop to pick them up and put them back on the cart. Yet one can see a similar turnip in a Dublin shop that evening for 6d. or 7d. We see Brussels sprouts selling at 2/- a 1b. and celery at 4/- a 1b. Farmers would be made up if they got a fraction of the price being paid by the consumer in Dublin. It is not reasonable to lay the blame, as the motion does, entirely on exorbitant prices being charged by manufacturers and distributors. There are a whole lot of agents and factors contributing to the high prices of the essentials of life. It is for that reason we ask the Dáil and the Minister to accept this amendment, which calls for a committee to inquire into all the factors that go to make up the vastly increased prices.

Mr. Davin

What power would you give the committee?

Mr. Lemass

The same power as the committee which reported in 1940.

Dr. O'Higgins

To investigate and report, to listen to evidence, to assemble facts. One has only to spend a day in observing, to see prices being asked in this city that are entirely fantastic. I was as much opposed as the Minister in the past to the British régime and administration here, but I must say that, since the beginning of the last war, I have developed a respect for British administrators that I thought I would never feel. I had occasion more than once during the war to visit Great Britain. I saw a nation there that one would excuse if their only outlook on life was to keep themselves in existence and bring the war to a victorious termination, if everything else were brushed aside as relatively unimportant, as things that could be attended to when the war was over. There I saw such efficiency, and humane control of prices as made an impression on my mind that will last for all time. I saw that you could fill your board in a modest way for a large family at considerably less than it cost in this country. I saw that the man or woman who was not out to be exceptional or extravagant or to set the height of extravagant fashion in dress, could dress as respectably as any one here for one-half the price. The reason for this was that the system of price fixation there was designed to let the man of modest means get his article cheaper than he ever got it before and to let the millionaire pay twenty prices for his clothes and other goods. Ordinary clothes and food-stuffs below a certain line of price were actually reduced and above that line the sky was the limit. Here we have the poor and the rich alike put through the mangle. On my visit—and I except the Minister felt in the same way—I wished I could have got coupons there with the same facility as an English person can get coupons here and if I could I would clothe myself from top to bottom at half or quarter the price.

Mr. Lemass

The Deputy must have walked round London with his eyes shut.

Dr. O'Higgins

The Deputy does not shut his eyes any more than the Minister. I could see the increase in prices. I have lived longer than the Minister and, probably, I have bought as much in the line of domestic commodities as the Minister. I am for a considerably longer number of years the head of a family and I appreciate prices and observe them both at home and abroad. I may not be as good a judge of quality, but in what appears to me to be a similar article I can see the dissimilarly in prices.

I have heard the Minister time and again in his speeches say that the reason why the cost of living was lower in Great Britain was that Britain had spent millions in subsidisation. I read a reply which appeared in the daily Press here on the 30th of last month, by a Minister in the British Parliament, giving the prices for certain commodities—bread, flour, oatmeal, meat, potatoes, eggs, milk, sugar and tea, without the subsidy and giving the price with the subsidy. In the main, their price without the subsidy is on a par with our price to-day. In spite of the fact that wages were allowed to follow prices in Britain, that a workingman earning £3 a week was able to earn £10, when the cost of rearing a family in Britain was the same as in Ireland and wages there had no limit, the British Government considered it advisable to spend hundreds of millions in order to reduce the prices of the necessaries of life. Yet here, after pegging down wages, pinning down salaries, and as far as we could do it fixing incomes at the pre-war level, calmly, and more or less casually, look on at the high price levels.

Whether we act through a committee or through an organisation or through some effective control or through greater energy in the use of the powers existing at the moment, I feel we have reached the point where something must be done. The Minister has only to talk to his colleagues to learn that the conditions under which the great majority of the people are living are conditions which should not continue one hour longer than necessary. The Minister of Local Government tells of all the hospitals built in recent years and of the vast increase in beds, of the way his treatment services and preventive medical services have been augmented and developed and of the highly competent methods of treating and preventing disease. At the same time, the result is that, never in the history of this country, was it so difficult for a sick person to get a bed in a hospital, the reason being that we have ten times as many sick as we used to have and three times as many going down with infectious disease, the cause being that the bodily resistance against anything that comes our way is completely undermined and sapped. The reason for that sapping of our vitality and our natural protective forces is that, within every family of modest means, the prices of commodities are so high in proportion to their limited income that less and less is being bought. The wage buys only half as much as it would have bought some years ago. The wife and the children are getting half as much as they used to get. When you reach the point of the 4d. egg and of milk at 5d. a pint, you can stop talking about eggs or milk in any poor house. The price of meat a month ago, without another rise on top of it, was such that it was idle to talk of fresh meat in any poor house.

I am stressing those things in order to try, no matter how futile it may be, to puncture Ministerial complacency, to wake up not only the particular Minister across the way but the whole Ministry to the fact that the situation is serious. Conditions outside are tragic. Unless prices are controlled with a firm hand, worse will come. If the result of ruthless investigation is that there is no undue profiteering, that prices must, of necessity, stay where they are, then something must be done. In that situation, the only "something" to be done is to subsidise, heavily and generously, all the essential articles that go to make up the life of a family.

Mr. Larkin (Junior)

It has already been stressed that very little could be said about the Minister's review of the price position in the Seanad which would be helpful to the present situation. Reading over the speech and examining it carefully, I am tempted to take issue with him on certain points. It seems to me that the whole weakness of the speech has already been indicated. That is, that, while it was in effect a review of the past six years in a spirit, to some extent, of satisfaction and self-glorification on account of what the Minister thinks has been eminently successful, there is not a single indication in the whole speech that he has attempted to approach the immediate problem facing us with a real appreciation of its gravity. Still less has he any solution for the problems that face not merely the community as a whole but certain sections with greater force than others.

The whole basis of his case in regard to the rise in the cost of living since 1939 has predicated the acceptance of the official cost-of-living index figure. He is quite aware that that index figure has never been accepted by that section of the community for whom it is, if you like, a measuring rod of the standard of life. These are the great mass of industrial workers and those who, in one way or another, are tied to that figure. That is a general criticism which has been repeated time after time. To take that index figure to-day and to try to indicate what the position is as compared with what it was in 1939 is leaving to one side certain drastic, fundamental changes which have been taking place.

In the compilation of that index figure by the British Government and, subsequently, by the Provisional Government and in its later application to our problems, certain standards have been fixed and taken for granted. So far as the ordinary citizen is aware, while those standards have been continued as the basis on which the varying changes in the cost of living have been calculated, no regard has been had to possible changes in the standards themselves. If we refer to certain percentage weightings used in the make-up of that index figure, we find that in 1939, of a gross of 100, a certain amount was allocated to fuel. That allocation was about 3.14 per cent. I wonder if that is the basis on which we are still allocating expenditure on fuel. Has any regard been had to the fact that the fuel used under the original formula was coal and that to-day we are dealing with turf? Again, the burning quality of that turf is not up to what would be regarded as average standard.

That, of itself, immediately throws a certain discredit on the whole index figure. I suggest to the Minister—this could be put in the form of a Parliamentary question but, since we are debating the matter, he might have regard to it—that, instead of merely releasing the change in the index figure each quarter, he would give us the benefit of a detailed statement showing the actual quantity of food, clothing and other household necessaries taken as the basis on which prices are obtained from the employment exchanges and the post offices in the various towns and cities and, at the same time, give us the same quantities for 1938 and 1936, with the price for those quantities in each year. Then, we will know where we stand when we speak of the cost of living and the standard of living.

The index is not a reflection or an indication of the standard of life. It is merely an indication of the changes taking place in what may be regarded as the arbitrary basis of the calculation. It would be much better for everyone interested in this matter if they knew to-day what is the budget taken by the Department of Industry and Commerce on which they quote prices and on which they work out this calculation. I expect to be shown that, from the point of view of the quantities referred to by Deputy Norton in regard to clothes and boots, there have been quantitative changes in the actual expenditure that must be made by a working-class family, and that will immediately affect the value of that index as an indication in the rise of the cost of living.

Another point made by the Minister, in a rebutting statement, was that this country had suffered relatively more than other neutral countries so far as the rise in the cost of living was concerned, and that the comparison that had been made was against certain countries which, during the six years, were in a position to export. He referred particularly to Sweden and to Switzerland. Surely, during the six years in question no country was in a better exporting position than this country. We were exporting the most vital products of all—food supplies— into a country that had the greatest need for them. In addition, we exported man-power there, where there was a lack of man-power. If there was any purpose in having an export trade during those six years it could have been utilised as a means for getting imports. Surely we were in as good, or even better, position than the two countries the Minister referred to.

I am not concerned with going over his speech because it does not make any contribution to the particular problem that we are facing at the moment. I want to speak on this question from the point of view of members of trade unions and of industrial workers. They are the people who are either going to have to solve this problem in their own way, or they are going to get an assurance not merely from the Minister but from this House as a whole that the problem which is facing them will be regarded as a national problem; that its solution will not be left to their unaided efforts and possibly efforts which require a greater effective strength than the results warrant, so that they can secure some assistance in the problem that is facing them.

When we entered into the present period—and we are still in it—we had the reaction from the Government that they proposed a standstill in the case of wages. They took certain powers to control prices, and then applied those powers in so far as prices are concerned in the piece-meal fashion which has brought us to the present position, whereas in regard to wages we had a complete stoppage put on them. Any improvement in regard to them subsequently had to be brought about by direct permission in particular cases. One of the results of that has been that we have had drastic changes in the division of the national income of the country as between the three main sections. That is a change that we do not seem to have sufficient regard to. The other day there was an editorial in the Irish Press replying to a speech which Deputy Mulcahy had made outside this House. The Irish Press stated that the share of the national income received by the rural community and the working classes had increased during those six years. The peculiar thing, of course, is that in the Irish Press the only place in which you find the truth is in the masthead. That statement, of course, is a deliberate contradiction of the statement made by the Government in its pamphlet on National Income and Expenditure. In that pamphlet it is set out that between 1938 and 1944 certain changes had taken place in the division of the national income.

The share of the agricultural community in 1938 was 25 per cent., and in 1944 it had gone up to 35 per cent. Let me say immediately on behalf of industrial workers that never at any time has there been any exception taken to that improvement, if it has been such, in the economic position and standard of life of those engaged in agriculture. The remarkable thing is that when we come to the next division, to those who obtain their share of the national income from profits or rents, there has been no change whatever during those six years. In 1944 they were still receiving their 30 per cent. as in 1938, so that the whole effect of the Government's controlling machinery has been to leave that particular section completely undisturbed, a section which makes no contribution whatever to the life of the community.

We are left then with the third section, those who depend for their share of the national income on their salaries and wages. In 1938 they received 44 per cent., while in 1944 it had dropped to 34 per cent. Therefore, what has been secured by the agricultural community has not been taken off the drones and those who live on the backs of the community. It is taken off by this process of Government control from those who are making an equal contribution to the life of the community—industrial and commercial workers, and those engaged in distribution—and from those engaged in the primary industry of agriculture.

It is no wonder that when these figures became known—they are reflected in certain facts which are the common knowledge of the great masses of the workers—we had the present period of growing and ever-increasing clamour on the part of industrial workers for an immediate and radical adjustment in their standard of life. We have to recollect that between 1938 and 1945 the number of estates of over £30,000 increased here from 44 to 92. So far as the payment of estate duty is concerned we have this position that in 1939-40 we had some 4,600 small estates. A small estate in the opinion of the Revenue Commissioners is one of less than £500. The number of small estates, as I say, in 1939 was 4,600, but those people had a sum of £900,000 in the value of their estates in 1944. There was an increase of roughly a quarter of a million. The sum represented in the next group of estates is £1,200,000. When we come to estates of £100,000, the number of people concerned is 4,500. Under that heading the increase was roughly £1,700,000. When we come to deal with estates exceeding £10,000, of which there were only 300, the increase is £2,500,000.

We have to recollect that the great mass of the people in this country, probably 70 or 80 per cent. of them, never manage to accumulate sufficient wealth to bring them within purview of the Revenue Commissioners. When they die and pass on we start to get a picture of the change that has taken place during those six years. On the one hand there has been a growing difficulty and a growing desperation among the masses of the common people and on the other hand an ever-increasing life of flaunted luxury and squandering on the part of a small group during those six years. The masses of the people who were engaged in production, in the communal life of the country and in the agricultural industry have been very patient during those six years. During that period we saw prices rise while wages were rigidly controlled. During the same period we saw that complaints were repeatedly made by leading industrialists that if it were not for this limited Government control regarding the payment of profits they could have done much better for their shareholders. They asked to be relieved of that control so that they could divide some of the additional income which they had been lucky enough to secure during those six years. On the one hand, the complaint was made that income had increased but that it could not be distributed. On the other hand you had the great mass of the people suffering a reduction of income, thereby reducing their ability to meet the everyday costs of life. During those six years we were told that it was the duty of every section to bear its share of the burdens and problems facing the country, and that, if there was a rise at any particular moment in the national cost of housekeeping, each section should bear its share of those increased costs.

The only effect, so far as the masses of the workers are concerned, following the efforts already made in trying to regulate the distribution of the burden—for which the Minister takes such great pride—has been to take from the industrial producers a percentage of the share of the income that they had in 1938 and to give it over to a small group who, in effect, make little or no contribution to the life of the country.

I may be told that there are many people within the category of those dependent on profits and rents who actively engage in productive activities in concerns with which they are connected, but for their direct participation they get recompensed, very often at a swollen figure in the form of salaries or directors' fees. I am speaking of people who have no direct personal contact with the concerns out of which they draw an income. Their only consideration is the amount of income they succeed in drawing and their knowledge very often of that concern is limited to its postal address.

That is the picture we have had over a period of six years, and while the great masses of workers were going through those six years, a period that was, in effect, for many of them sheer purgatory, they were comforted with the statement that when the emergency ended there would be a relaxation of control, and there was a general acceptance that their position would be improved and that they would be put in a stronger position to meet the swollen cost of living. That was accepted on all sides, and immediately we had the termination of the wages standstill Order, without any equivocation, the workers, organised and unorganised, came together and put in their claims.

That position was foreseen. Early this year the House spent many hours trying to set up machinery which would deal with that problem and enable it to be dealt with in a regular manner, with the least disturbance to the country as a whole. The workers have shown their sense of responsibility. With very few exceptions they have agreed to utilise the machinery of negotiation with employers. Where that has not proved capable of adjusting the problem, they were prepared to let the matter go to the Labour Court. Only in certain cases, where there have been difficulties peculiar to the trade or industry, or because there have been certain extraneous factors, have we had any actual stoppage in relation to portions of our national economy.

In other words, the workers have gone through six years, during which their incomes were controlled and during which they saw other sections of the community complaining of their inability to take advantage of swollen incomes. The workers are again using their patience and are acting in a reasonable way, trying to adjust their difficult conditions with the least disturbance and with the least cost to the country. They are quite prepared to argue their cases with their employers and, if they do not succeed, they are prepared to go to the Labour Court, and nine times out of ten they will accept whatever decision is arrived at. They are doing that because of the general understanding that there would be a readjustment of the workers' income in view of higher prices. There was an understanding that that would be done, first, because of the heavy burden placed on the workers and, secondly, because it was essential to secure some stability in the country's economy.

In formulating their claims, the workers were quite entitled, just as Senator Summerfield did in the Seanad, to say that their working costs are increased by 70 per cent. and, therefore, they want a proportionate increase in their wages. That is what Senator Summerfield said in the Seanad—that if he gave an increase in wages, his working costs would thereby be increased and he would have to pass that on to the consumer. The workers say the same thing as regards themselves. Their attitude in some cases probably gave rise to conflict, and a good deal of friction and disturbance was caused at a critical time.

Speaking for the trade union movement, I do not know whether we were wise or foolish, but in our wisdom or our foolishness we took the view that if we sought the full 70 per cent. adjustment of our wage rates in order to bring us back to the 1939 standard we would be starting off on a vicious spiral, of which we have heard so much here. So, while there have been claims for 70 per cent., in all cases where there was an adjustment by direct negotiation or by reference to the Labour Court, that adjustment has varied from 40 to 60 per cent., in the case of the very poorly paid workers, and it has been accepted as a reasonable adjustment for the time being.

The workers believed they were keeping their adjustment within the present ability of the great mass of employers to meet the increased cost out of their accumulated reserves or present income, and they felt they were taking away the opportunity from persons such as those who spoke in the debate last week to utilise every claim made by the workers as an argument for a further increase in price. They said: "We will leave a gap of 20 per cent. or 25 per cent. between our new wage rates and the present increase of 70 per cent. in the cost of living; we will leave that as a cushion in the hope and the belief that this gap between our income and expenditure can be closed from the two ends at the one time, first, by adjusting wages and, secondly, by taking every possible step to reduce prices. We are satisfied that there is no sound argument for a further increase in prices and, that being so, we are content to exercise our patience a little longer in the expectation that that gap of 20 per cent. or 25 per cent. can be closed from the top by reduced prices."

Lo and behold! instead of that happening, the gap is starting to widen again, not merely from the point of view of the individual employer, but from the point of view of semi-State bodies like the sugar company. A letter appeared in the Irish Press the day before yesterday and it would be well if the Minister were to reply, in the course of this debate, on the point raised in that letter. The letter is a direct accusation of the most outrageous profiteering on the part of the sugar company, a semi-State body. We had difficulty here over the claims of certain workers for improved conditions and better wages. That difficulty might have been adjusted by giving the workers all they were looking for at a cost of something like £100,000. We had the position where a conflict was allowed to develop. That conflict has now been referred to the Labour Court and, arising out of it, we are now told that certain compensation has been given to the farmers and the result must be an addition of 1d. to the price of sugar supplied to the ordinary consumer.

Mr. Donnellan

Compensation for loss.

Mr. Larkin (Junior)

What is the compensation to the sugar company for? I am not an expert on the figures referred to in this letter but the statement is plain there that the sugar company is taking in more than double what they are paying to the farmer.

Mr. Donnellan

Correct.

Mr. Larkin (Junior)

If we have a headline like that set by semi-State bodies, why should not the private employer follow? After all, the Minister is a believer in private enterprise and a believer in the present system of economy we have in this country. That system is based on the idea of taking advantage of the other fellow. The successful business man buys cheap and sells dear. Many of them, if you like, have got a conscience and do not go to the limits like certain other individuals but all the time it is a question of being a little smarter and a little quicker off your mark than the other fellow.

That in ordinary language means putting something over on somebody else. When we have this example set by the sugar company, why should we be surprised if individual firms or whole trades or industries follow the same practice? In to-day's paper we have a statement in relation to the furniture trade in this country, that because of increases given in wages the manufacturers have to increase prices by 10 to 15 per cent.

I have been looking over some of the figures given for this industry in the latest statistics available—the census of production for 1943. The gross output was taken as £600,000 and the wages content was £284,000. Adding an increased price of 10 or 15 per cent. to these figures, it means that we must add some £80,000 to £120,000 to the value of the gross output, all of which is supposed to be due to the increase in wages. I am familiar with conditions in the furniture trade, and in order to justify that increase in the gross output as represented by prices, it would mean that the workers would have been successful in increasing the present rates of wages by 30 or 40 per cent. I am quite certain that no such increase has taken place but the relatively small increase in wages is immediately taken as a justification to increase the cost of furniture by 10 or 15 per cent. to the consumer. The same thing has happened in the case of bread. Recently when the question of wages in that trade was before the Labour Court, we were told that the price of bread must be increased. Bread was supposed to be sold at a price that in effect meant a loss to the baker, and that loss was supposed to be made up by a subsidy by the Government. Yet one of the leading bakers is at present engaged in carrying out new extensions to his plant. The cost of these extensions will run into some £100,000 or £200,000. I have no knowledge that he has sought any fresh capital to finance these new extensions and, apparently, the expenditure is coming out of reserves which he has accumulated during the period when he was supposed to be working at a loss.

These things are symptomatic of the present situation and they are things which the worker is watching—an increase in the price of sugar, a possible increase in the price of bread, claims for increases in the price of milk, increases in the price of furniture, increases in every case where the worker was lucky enough to secure some adjustment in his rate of wages. I have been present at a number of conferences and a number of sittings at the Labour Court, but I have yet to find an employer willing to stand over his statement that the increase in wages which he was asked to give would lead to an increase in prices or to say that he was prepared publicly to come out with figures that would justify that statement. It is all very well for the Dublin master victuallers to go into the Department of Industry and Commerce and make their case there, but it is quite a different thing to do that in public, subject not merely to public discussion but to public knowledge. That applies to a great many traders who are at present seeking an increase in the present prices. It is because of that secrecy, that lack of knowledge and what Deputy Norton referred to as a lack of public confidence in the machinery, that we have got this growing doubt in the efficacy of that machinery and the growing feeling of a need for taking some drastic steps to deal with the problem.

So far as the mass of organised workers are concerned, possibly we are quite capable of looking after ourselves and we might do so in a way that would be fairly costly. There is, however, outside our organised ranks a great mass of unorganised workers, people engaged in industry in various occupations who are living on small salaries and for whom there is no hope in the organised power of the trade union movement. These people are completely dependent on this House and on the action this House will take to protect them.

The Minister in his speech last week asked for public co-operation in enforcing price control. Surely no one has been more guilty of destroying confidence in price control under the present system than the Minister and the Department operating under him? There is no need to go back over the whole sorry story but if the Minister wants public co-operation he has got to take certain definite steps. One of them quite clearly is that if the policy adopted for dealing with the wageearner and the recipient of a salary in 1941, the policy of putting an immediate embargo on any increase of wages or salaries, was a good and justifiable policy, why not apply it to prices to-day? Let us as a beginning put an immediate embargo on prices and costs of services so that we can get some grip or control on the cost of living for the community. Having got that, let us deal with claims for increased prices in the manner in which we dealt with claims for increased wages from 1941. Let each individual who is interested come forward and make his case, and above all, make it publicly before a public tribunal. We cannot have public confidence so long as we have the settlement of these claims for increase dealt with by a section of the Department. I am not placing any particular blame on that section. They have got to operate in a certain way. They are compelled by the very nature of the work, to operate behind closed doors and in a way in which there can be no public knowledge of what transpires. After all, an increase in prices to-day is a subsidy to the employer or to the particular trade or industry.

Suppose we look at it from another angle. We are subsidising old age pensioners, widows in receipt of non-contributory pensions and people getting public assistance. We have got a high regard for family life in this country and for the ordinary intimate secrets of the family. Yet if any of these unfortunate men or women require support in the way of pensions or assistance from a public authority, they are subjected to the most minute investigation of their private affairs. Is there anything wrong in asking a manufacturer of any commodity, who wants a subsidy in the way of an increased price for that commodity, to submit his case publicly before a tribunal? If it were a case of asking a direct subsidy from the Exchequer there would be a method by which the matter could be debated publicly in this House. When a manufacturer wants a subsidy in the form of an increased price for his products why should he have all the protection of a confidential investigation and a private decision on his claim? So long as that system operates, we shall not get the co-operation of the public or even their interest or confidence in price control machinery. I do not think it is too late to make a change in that method. I think the great mass of the public are interested and are anxious to co-operate but if they are going to co-operate we must first provide a basis on which we can build up that confidence and, secondly, we must give them the machinery by which they can co-operate with the central machinery.

One method I suggest is the encouragement of local initiative and a local approach to the problem. In addition to the central control, the inspectors, there should be some machinery whereby local committees representative of the most active and the most civicminded persons in the community, could come together on an official basis, with an official appointment from the Minister, given certain limited powers in so far as the locality is concerned and enabled to act as a central body to build up and encourage co-operation with the central price machinery and through which there could at least be a local check upon the general price levels in the locality.

If we could get these three steps taken—a standstill on price increase for the moment, some form of public tribunal to examine claims for increases in prices and machinery by which the public could co-operate—then I think we could probably deal with this problem.

I am speaking, as I have said, from the point of view of those who are seeking to adjust their weekly incomes by means of wage claims, but let us look at it from a broader point of view. If we do not take some steps, what will be the outcome of the present situation? I take it for granted that all of us are anxious to see some degree of economic stability achieved within the shortest possible time in this country. If we are to achieve it, we have, first, to improve our position in the matter of supplies; secondly, we have to take it for granted that we must increase our producing capacity; and, thirdly, we have to get some degree of co-operation and a willingness to help forward the common effort on behalf of the big mass of workers engaged in trade and industry.

So far as supplies are concerned, there is not much the average worker can do. So far as production is concerned, we are told, when we seek increases in wages, that these increases represent improvement in our conditions which can only come through an increase in production. Where, how and in what circumstances can the average worker to-day make any contribution whatever to improving or increasing production? If he dares to open his mouth as an ordinary employee, he is immediately told what his place is. If he dares to do it through his trade union at a conference, he immediately finds a kind of dead wall in front of him, because at present there are certain things which we will not be allowed to know, and, until you know them, you cannot approach the problem of production or try to find ways and means of improving it.

But assume that there are publicminded workers with expert knowledge of their particular unit of production willing to make suggestions, of what advantage is it to them? In the first place, if the suggestion is taken up, it may be in a trade or industry in which the workers have secured some slight increase in wages and where that increase has been immediately utilised to secure a bigger proportion of an increase in prices so that not only is his increase in wages used as a stick with which to beat the public generally, but even as a means of taking back from him as a consumer portion of the increase in wages he has got as a worker. Thirdly, if his interest in increased production does take practical form and he makes practical suggestions, where, how, and in what form will he ever get the slightest recognition in this country for that interest or those practical suggestions? If increased production is to be regarded as being tied up with increased wages and improved conditions, if it is to be a prerequisite in respect of the securing of increased wages and improved conditions, the workers have got to be afforded an opportunity of having some say in and some control of the machinery and the factors which finally govern production. They have not got that in this country to-day, and whether they will get it or not, I do not know, but it is neither fair nor practical to accuse them of failing to make any contribution to an increase in production when, on every hand and in all circles, they are denied any approach whatever to the problem or any close contact which would enable them to make an actual contribution.

From that point of view, it is not very surprising that workers, when told that the condition on which there can be higher wages and better conditions is increased production, say that it is not their concern, that they are going to secure the increased wages and improved conditions by their own means, and, until somebody with authority and responsibility solves the problem of a closer relationship between workers and management, the workers are not going to concern themselves with this problem, which not merely is outside their field but is deliberately kept outside their field and their knowledge.

That is why this problem of the growing threat of increased prices is not a question such as we had for the past six years of trying to overtake this growing expenditure with a very slowly advancing income, but one which is becoming a vital problem for the community as a whole, as to how soon and under what conditions we can expect some return, not to the normalcy we knew in 1938-39, but to some form of relative stability for some period, during which we can get on our feet, see where we are and see what the future holds for us. Until we tackle this immediate problem, however, there is no hope whatever of securing that temporary stability. We are going to have a continually growing circle. We start off with what everybody in the country, from those speaking for political Parties to those speaking for sections of the agricultural and industrial community and members of the Church and spokesmen of the Churches, agrees is not only reasonable but absolutely necessary, that is, an immediate adjustment in wages and salaries for the mass of the ordinary members of the community. Everybody agrees on that and yet we are content to sit by and see that adjustment taken back again by allowing prices to increase further.

I am not concerned with the Minister's review of what took place during the past six years, but everybody is concerned about what he has to say with regard to the next six months, and, so far, we have had no indication. It is quite clear, even on the evidence that has been accumulating during the past few weeks, that there is no hope whatever of these efforts being made to increase prices being held within any reasonable bounds. A claim of 10 and 15 per cent. in one industry alone, a claim in regard to two of the basic foods, face us already and we have not even started to see the avalanche come over the hill on top of us yet. We propose to try to deal with that with machinery which, even giving it due credit, has not proved particularly effective during the past six years, and which does not enjoy public confidence.

Even if it is applied to these claims for increased prices and certain increases are allowed, which, so far as the Department is concerned, may be wholly justifiable, there will be no acceptance of that justification in the mind of the public, because they lack confidence in the price - control machinery and those increases which may be permitted will be immediately regarded as being an offset to the moderate adjustments made in wages and salaries during the past few months. Immediately that happens you will have further claims and further demands for increases in prices and we will find ourselves on a kind of endless spiral staircase upon which we do not know where our journey is going to end. I would urge upon the Minister that he would seriously consider the suggestions that have been made on this side of the House and that he would take his courage in both hands and apply now to prices in 1947 the same policy which he applied to wages in 1941.

We are faced now with exactly the same position. In 1941 you had the Standstill of Wages Order. Give us now a Standstill Order for prices. You regulated the increase in wages in 1941. Regulate now the increase in prices in 1947. You carried out that regulation by means of public advisory tribunals before which any member of the public could go and at which any member of the public was free to listen to the proceedings. Let us have the same procedure now. Let the public know what is taking place and let the public know how prices are arrived at and how decisions are made. Let us have some machinery with which the great masses of our people can associate themselves and some machinery in which they can co-operate in order to make it effective and to give effect to the decisions of the central controlling body.

If we do that I have no doubt that we can adequately deal with the present situation. I am perfectly satisfied that in practically all the trades and industries in which increases in wages are now being granted, either by means of direct negotiation or under the auspices of the Labour Court, the increases are of such a measure that every trade and industry can bear those increases out of their existing resources and out of their current income. I have had to examine the figures in order to find out if we could justifiably stand over the claims we made. In no case did I find any reasonable argument, sustainable by a company or an employer, which would show that there was no other way to meet the increased charges of increased wages than by an increase in prices. That is true of the largest companies in this city right down to the smallest and down to the private employer, with one exception. One small employer has said that the claim made is so excessive that he cannot meet it. He has threatened to close down. This is the second time on which he has made that threat, but he has not yet closed down.

It is quite clear when we examine into the cost of new buildings and concerns engaged in industry and distribution and the statements that are made and realise, at the same time, that every other day companies are giving bonus shares to their shareholders without one additional penny of capital being subscribed—and on which in the future the workers will have to pay dividends—we must realise that there are more than sufficient resources to justify us in demanding an adjustment in wages and salaries while ensuring that there shall not be any disproportionate increase in prices at the same time. The Minister was quite right when he said that low prices do not hold out any attraction for workers. He did not actually go deep enough into that matter. What he should have done was to pay more regard to the cause for the low prices. Low prices are indicative of something else. In the past low prices have generally been indicative of a lack of purchasing power on the part of the workers and indicative of unemployment. High prices, on the other hand, do not indicate that they are particularly favourable to the workers. It is the relationship between the income of the workers and the prices workers have to pay for commodities which is the important factor.

I would again ask the Minister would he issue a statement showing the actual budget, in so far as quantities are concerned, on which prices are calculated four times per year for the purpose of making a computation as to the changes in the index figure. Would he give us those quantities for 1938 and the prices in 1938 and would he give us the same quantities and prices in 1946? When we have that we can then gauge the relative change in the index and we can at the same time make a practical comparison as to what that represented for the average workingclass family in 1938, what they are able to buy to-day and what they have to pay for it. We can then adjudicate on his statement that the control of prices effected during the last six years has been reasonably efficient and that the increase of 70 per cent. is not exceptional and that there has not been such a radical change in the position of the masses of the people as some of us would appear to believe.

That is in regard to prices. I would urge in particular that he should give serious consideration to the main problem which I have mentioned. We are dealing here not merely with the question of prices and wages but with the whole immediate economic future of our country. One of two things will happen: either we shall have chaos here or we shall have some reasonably controlled and planned development. The power to bring about that reasonably controlled and planned development lies in the hands of the Minister and in the hands of the Government. He has applied a certain policy in the past in regard to the control of wages. I would urge upon him now the necessity for applying a similar policy in a reverse direction, namely, in the control of prices. There is no reason why he should not be able to do that. The penalties that may ensue from the present situation will be graver than those which might have ensued in the dangerous situation that existed in 1941.

General Mulcahy

I move the amendment:—

To delete all words after the word "opinion", and substitute therefor the following:—

"that a serious danger has arisen for all sections of the community due to the high and rising cost of commodities essential to health and life, and requests the Government to take immediate and effective action to reduce by every possible means, including if necessary by subsidy, the cost of the main necessaries of life; and to set up a committee or committees which shall sit in public (1) to examine without delay into the causes of the high prices of the most important commodities in order to prevent profiteering, and (2) to ascertain the steps necessary to bring about a general reduction of prices."

It is because of the fact that we are gravely concerned—as nearly everybody else must be gravely concerned— with the next six months, as Deputy Larkin has said, rather than with the last six years, that we put down the amendment standing in our name here.

We can go back to 1933 and 1934 and we can see, as a result of actual official reports, the extent to which millers at that time made profits which were officially reported to be exorbitant. We can remember how the bacon companies set up at that particular time paid back their subscribed capital out of the profits which they made in the first year or two. We can recall the same thing with regard to certain new boot factories which were set up here. We can remember how ineffectively we protested against the exorbitant profits that were made in those years and we can remember that, even in peace, our voices made no impression on the situation.

We would be lacking in our sense of responsibility if we were to sit down now and waste our time arguing against those people who in the past six years have made substantial and excessive profits. There is an urgent job of work to be done and we require manufacturers and distributors, as well as every other section of the community, to co-operate immediately in the work that must be done, particularly in the next six months. Deputy Larkin has indicated that this is not a mere passing phase but a fundamental economic challenge. I believe that that is so. I believe that one of the reasons why the Government fails to face up to that situation is because the challenge is so very fundamental. Deputy Larkin has asked that prices be stabilised at their present figure. I completely subscribe to that demand. That, at least, would give us some basis on which to work. He asked the Minister to disclose the budget upon which the cost-of-living index figure was based in 1938 and a similar budget at the present time. I think myself that we need not bother very much about that.

We have set up quite recently a Ministry of Social Welfare. The first contribution that we ought to expect from that Ministry is that they would give us a basic diet for the adult, the adolescent and the child. That should be fully within the competence of the new Ministry with all its expert advisers. If we have that then we can decide on what food we must be prepared to provide for our people, whether in poverty, or in sickness, or in unemployment. When we are clear on that point then we can become clear as to our economy and we can stabilise prices at a point which will bring commodities within the scope of all. The Minister should provide us too with a budget for the average type of family so that we can know what kind of food and what commodities we must make available for our people.

When that is done the voluntary public movement of which Deputy Larkin has spoken will gradually evolve itself. Particularly, people would have a standard of what we expect to give our people as adequate food. They would have that as a guide to their conscience and intelligence, as they moved among their neighbours to see if they are satisfied with the condition of the people, from the point of view of feeding.

If we, after our discussion here to-day, could start off with these two points, then, whatever cause of complaint there was about any section of the people, we would advance steadily, clearly and intelligently, with a certain amount of understanding of one another and a certain amount of harmony, to bring about a situation in which we would banish excessive profits or, at any rate, we would see a clear road before us for bringing the State services to aid the poor and to see, that men were able to support their families out of their wages. While I may address myself now to the poor and to the necessity for sustaining the poor, I do so because I want to get a particular standard but the other fundamental fact remains that, unless the workers in the country can settle down in a stable way to their work and can feel that out of their work they are building up the industrial and economic side of the country and are able at the same time to live stably and comfortably and fairly prosperously at home and rear their families, then we have a rot at the centre of our economic system that, whether people go on strike or do not go on strike, is going to destroy our country.

The cost-of-living index, about which so much has been said, in particular by the Minister in his recent speech in the Seanad, is merely befogging us and keeping us from the realities of the situation. In about February, 1942, that is, five years ago, I had occasion, in the circumstances of that time, to sit down in conferences, systematically to see what could be done to fix a standard that would sustain the ordinary working people and, that standard being fixed, to see what could be done to ensure that they got it. In one of these conferences I came across an ordinary worker. He was married. He had a family of seven children. He had been in fairly constant employment. He was suffering from the difficulties of the time. I asked him what would he like to provide his family with by way of food. He gave an outline of what he did provide his family with when he was able to do it. He said he would like them to have a little porridge and milk in the morning and maybe a cup of tea and a slice of bread; that the children going to school would have a little milk and two slices of bread; that for dinner they would like to have meat, however small a portion, some potatoes, some vegetables; that for tea in the evening they would like to have tea and a couple of slices of bread and perhaps now and then a little vegetable; that he would like to have a little milk at night, particularly for the children. He said his work required that he should have a good deal of bread, that he was a manual worker and, therefore, if he could manage it, he would like to have a raw egg and some milk in the morning. When he was able to provide that for the family, he said, they were able to withstand the cold, but it was not so easy at that time, because he was not in permanent employment and when he was out of employment he was not able to provide it.

It was modest kind of fare for a man working his way in a free Ireland. It was a modest ambition to be able to give his family that much. He had a little more ambition: he would like to give them something to eat with their breakfast on Sunday morning— it is the least, I think, that any Irish family would want—and maybe sometimes on a Saturday evening with their tea. They might like to feel that the week-end of rest was there and they could sit down with a little more comfort and a little more satisfaction over a meal. That was his outlook. I asked him to give me what the cost of that would be. He gave it to me as a daily cost. He said bread would cost 2/2¼d.; meat, 3/6; milk, 8½d.; sugar, 3d.; butter, 9½d.; between baby food and other small items, including vegetables, there was an additional 1/10½d. The total was 9/3¾d. a day or 65/2¼d. Eightpence-halfpenny for milk, for a family consisting of a father, mother and seven children, was not an excessive figure. When we take into account the rise in the cost of living, from 209 in February, 1942, to 268 in November, 1946, it means that, instead of 65/2¼d., he will have to pay 82/7¼d. That was his story. Recently I asked some people who had experience in these matters, from a theoretical point of view if you like, but also from a practical point of view, to cater for a family of that size in the items here mentioned. They gave the following quantities: For two adults and seven children, 8 lbs. of bread a day, 3lbs. of meat—the more experienced person as head of a house expressed the opinion that for a family of that particular kind, living in not too flourishing circumstances, perhaps 2 lbs. of meat would do there; 12 pints of milk—the more experienced housekeeper said 9 pints of milk would be as much as they could ever afford to get and it was likely they would not be able to get it; sugar, ½ lb.; butter, 8 ounces; tea, 1 ounce; porridge, 2 pints, consisting of 3 ounces of oatmeal; potatoes, 7 lbs.

The estimate, which included the 12 pints of milk and the three ounces of meat, would work out at 100/11d. and the more modest estimate would work out at 82/3, being 2/8 for bread, 2/8 for meat, 9d. for vegetables, 3/- for meat, 3d. for sugar, 1/2 for butter, 3d. for tea, 4d. for porridge and 7d. for potatoes, per day bringing the weekly expenditure to 82/3.

We have set up a Department of Social Welfare here. Can they agree that that ration is necessary for a family of that size? If it is not necessary, can they scale it down and price it in relation to the cost of things to-day? We have a condition of poverty and under-nourishment amongst some of our people, we have the vast majority of workers earning wages supposed to be full wages, a day's wages for a full day's work. If we find that section in difficulty on account of the relationship between wages and the cost of maintaining their families, if we have an experienced honest opinion that the food alone necessary to maintain them in a modest way and reduced to these simple items would cost 82/3 a week, we ought to have an official opinion and official information about it, particularly if we are to have quoted against us or against any section of the people, in argument about the economy of the country or about wages or prices, what is called the cost-of-living index figure.

We are concerned with the cost of living. The 65/2¼d. that that man, in February, 1942, would like to spend maintaining himself and his family, which equals 82/7¼d. now according to our cost-of-living index figure, or 82/3 according to the simplest estimate of a person with a certain amount of experience looking at the problem in a detached way, is for nothing but food. There is no allowance for rent, clothing or fuel, the importance, the significance and the cost of which was referred to by Deputy Larkin. There is no allowance for paying a single halfpenny for the upkeep of the State by way of excise duty on drink or tobacco, or entertainment tax.

As long as that situation is left unexamined by the real experts—the Government statisticians, in relation to Government medical services and the Government Ministry outlook—you do not know what you are arguing about, when discussing wages or the maintenance of the State here by the contributions of the workers, you do not know anything about one of the fundamental things of our economy—the maintenance of our people in health.

That is important, if we look at the position of a person on unemployment insurance or unemployment assistance and it is important in relation to some of the wages being fixed now before the Labour Court. Let us take a man, his wife and five children—which, from some points of view, is the simplest case to take. If he is on unemployment insurance, he gets 15/- for himself, 7/6 for his wife and 2/6 for each child with 2/6 in respect of each of three children under the Children's Allowances Acts; and for five children, for himself and his wife he gets food vouchers to the extent of 18/2, making an income of 60/8. If he is on unemployment assistance, his income is 48/8 and he can get additional assistance under home assistance. The biggest figure I know being paid in Dublin at present under home assistance is 14/-, to a man who has a wife and nine children. Relate those figures to the estimate I give—which admittedly is for two additional children—and realise that the figures contain nothing for rent, clothing, education or taxation. Then you realise there is a definite question to be answered in regard to those people who are not in regular employment and who are dependent on unemployment insurance, for which they pay, or on unemployment assistance, to maintain their families in health.

Let us look further. I am speaking largely with regard to the City of Dublin, as the big problem is in the urban centres. If we deal with them, we will know something about it and we can proceed to deal with the problem in the rural areas. Recently, the wages for drivers and conductors of buses in our transport service throughout the country have been fixed. That service is a permanent piece of our economic machine which it is necessary to maintain and we ought to expect such workers to be paid wages sufficient to maintain themselves and their families. The pay of a double-deck bus driver is £5 7s. 6d., of a single-deck bus driver £5, of a double-deck conductor £5 2s. 6d. and of a single-deck conductor £4 10s. If any of these men have five children, there is an additional 7/6 in children's allowances. When those figures are compared with the requirements of an ordinary manual worker in Dublin in February, 1942, and brought up to date in relation to the present cost of living, it is easy for any experienced person to see that there is a problem there to be faced.

We should not be afraid to face the problem, but I think our trouble is that we had a serious problem before the war came and we were not prepared to face it. If we do not face it now, we will run into a very serious and very different situation in the years to come. The fact that there was a problem here before the war is evident from appendices in the Report of the Inquiry into the Housing of the Working Classes in the City of Dublin, 1939-1943. Appendix 23 gives particulars of 9,200 families of two or more persons, taken at random from those surveyed by the Corporation of Dublin in the year 1938. It is there found that 2,754 families, having fed themselves on a modest scale, had not a halfpenny left for rent or fuel or for any other thing connected with their lives. That was 30 per cent. of the lot. We find that 675 had only 5/- left and 788 had only 10/- left. Those three groups accounted for 45 per cent. of the lot.

In Appendix No. 17 of the same report you get particulars showing the size of families and the incomes thereof on a percentage basis in respect of 10,500, and the 1938 survey of the details showed that we started on our road into the conditions which the war had left us with a very serious problem. We may have to face up to the fact that the standard of living for the ordinary people will be for a long time substantially below what it was in 1939 as a result of the economic circumstances which the war has brought upon us. If so, let us know it. If there are difficult times to be faced by our country, we faced difficult times in unity before. The more difficulty they are, the less we can afford to have misunderstanding between one another as to what exactly the situation is and what should be done to remedy it. As in other matters, we are likely to have serious and wasteful differences in relation to our economic situation unless we examine it closely. I suggest that the fundamental we should examine is as to what is required in suitable foods to maintain an ordinary family which is below the average wage line and what is required to maintain the wage worker who is in stable, permanent employment in manufacture or distribution or in the teaching service or civil service. It is essential, in relation to the poor side, to decide what clothing is required.

Deputy Larkin mentioned the setting up of a tribunal to deal with these matters and stressed the necessity for dealing with the costs of things in public. I think that a number of ad hoc committees should be set up for items in both the food line and the clothing line so that there would be no delay in queueing up. I think that it should be possible to set up a sufficient number of committees to examine the prices of the important commodities that bear upon the maintenance of our people's lives, whether in food or clothing, and to pronounce upon the price which, in economic fairness to the producers, should be fixed.

I think that these examinations should be carried out in the same public way as examinations in regard to wages are carried out by the Labour Court. If some matters should be treated in confidence, there is no reason why they should not be so treated until reason to the contrary is shown before the tribunal, just as certain matters are treated as matters of confidence by the Labour Court. Unless we proceed urgently with machinery for examining prices of the special commodities, we shall not know where we stand and there can be no judicial or intelligent way of seeing how we can prevent prices rising, on the one hand, and how, on the other hand, we can reduce the prices of those commodities which are at present so high as to injure the health and lives of our people.

It may be that some of those prices cannot be reduced sufficiently low to make it possible for the average wagesearner to maintain his family in health and comfort. If that is found to be so, then subsidies must be provided, despite what the Minister says as to the difficulties in that regard, or wages must go up, or something else must happen. We cannot see sections of our people running into additional sickness and simply saying that we cannot do anything about it. We were very quick to make all the necessary arrangements when France fell. We had to strengthen our Army and build up voluntary services. It may be said that that was easy to do. Surely our civilisation is not going to be of the type which will render it easy for us to prepare to save the country in war but difficult for us to organise our economy in peace so as to attend to the health of the weaker of our people and those who are the vast majority of our workers—the wage-earners. We shall have to do something about it. If prices, on the one hand, and our standard of subsistence in food and clothing on the other hand, were fixed, and if we saw that there were serious deficiencies which prejudiced the life and health of our people, we should have to sit down and find some way out. If we are definitely going to admit that circumstances will pin down the standard of living of our people, let us realise that.

If we accept that for the majority of the people as a whole, let us see that it is accepted by those who are better able to reduce their present standard of living. If Deputies have an oppor- tunity of examining the arrangements made to fix the increases of civil servants they will find that there is a much bigger discrepancy than say 20 per cent. between the rise in the cost of living at the present time and the margin on which the new increased rates have been fixed. There is a much greater increase than the 20 per cent., which Deputy Larkin speaks about, that has to be overcome. Civil servants are not very popular when it comes to discussing the cost of their upkeep, but as a State we cannot get on without a Civil Service establishment. We are very proud of our Army when it comes to the point that the Army has to do something. The Civil Service is an army of servants. They are wanted day in and day out, particularly the heads of the Civil Service. They are not wanted at all if they are not going to be accepted and trained to be your expert thinking machine when Parliament wants somebody to help it in its thinking.

In the case of individual members of the service, they have been substantially reduced in their standard of living as a result of the position that has been taken in relation to their new increases. Take the case of a married man in the Civil Service whose total remuneration in 1939 was £105. The cost of living has gone up on him by 70 per cent. The new scale of salary only provides him with an increase of 54 per cent. In the case of a married civil servant with a total remuneration of £495 in 1939, his cost of living has gone up by 70 per cent. He is now given an increase of 37 per cent. A civil servant earning £1,009 a year in 1939 has to meet an increased cost of living of 70 per cent and is provided with an increase of 26 per cent.

I admit that the Civil Service as a body is somewhat helpless in itself. It is a class, the Government will probably say, that they could not make very popular, but, nevertheless, civil servants are an essential and permanent part of our State machinery. They have been reduced in their standard of living to the extent implied in the figures I have given. I ask that we face the fundamental things that require to be considered in connection with this motion so that we may get a focal point on which we can have fixed minds and feel that we have a settled judgment. If we do that then we would be able to understand ourselves in regard to the different points that have been made in this debate. We may be able to fill in the gap and say that the situation was not as bad as it it. But whether it was bad or not, we should be prepared to face up to it and remedy the things that require to be remedied. We should see that our people will be fed and will be able to live a healthy life, so that the work of the State may be carried on properly, and become the kind of State that we want it to be.

Minister for Industry and Commerce (Mr. Lemass)

If price control was as simple a matter as the Deputies who have spoken seem to think, there would be no need for this debate. It would be quite practicable to make an Order pegging all prices as Deputies Norton Larkin and Mulcahy have suggested if we were prepared to ignore the probable effect of that Order upon the supply of goods or on employment. The Government could not, however, ignore the other consequences of such an Order.

If we have reason to think—as the very recent experience of the United States of America in applying the precise policy there which Deputies are advocating here, would give us reason to think—that the making of such an Order would have the effect of causing supplies of essential goods to disappear from the markets within a week and the disemployment of thousands of workers, should we not think twice about it? Deputies are over-simplifying our problems. The economic system which we are working is a price system, and any arbitrary interference with prices, even in normal times, might bring it to a stop. Arbitrary interference with the price mechanism would be more difficult and more dangerous in circumstances such as we now have in which the volume of money available is considerably larger than in normal times, and the volume of goods which that money can purchase is considerably less.

Price control is not the simple problem which Deputies have suggested. Every time the question of price policy is raised for consideration all the economic and social reactions, of every possible course, have to be taken into account. Time and again during the emergency I raised these major considerations of policy—the effect of price control—in the Dáil on the Estimates for the Department of Supplies, and I invited the observations of Deputies on them. I rarely got observations on these questions. Deputies were no doubt, concerned about rising prices at all times, and on many occasions during the course of the emergency, and during the debates upon the Estimates for the Department of Supplies, Deputies adverted to the fact that a consequence of fixing prices for commodities appeared to be a reduction in the supply of these commodities or their total disappearance in some cases. I do not say that is a necessary consequence, but, if we are to adopt the very simple policy which has been advocated by Deputy Norton and Deputy Larkin, let us be quite sure what the consequences will be.

I do not think our situation is quite as was described. The social survey which Deputy Mulcahy advocated and which, apparently, he, single-handed, tried to carry out, might be useful, and a reliable survey of that character would undoubtedly give us information which would help in the framing of policy. The need for such a survey, the relationship that exists or should exist between wages and prices, the general soundness of our social system —that is not quite the issue that is raised in this motion.

General Mulcahy

It is the danger that is there.

Mr. Lemass

The Dáil is asked to decide by the main motion that manufacturers and distributors are in the habit of charging exorbitant prices, and it is asked to decide that the Government should forthwith introduce proposals for the purpose of securing effective control over profits and prices. The Dáil is asked by the amendment to take note of the high and rising cost of commodities and to request the Government to take immediate and effective action to reduce the cost of the necessaries of life, if necessary by subsidy, and to establish a committee to inquire into the causes of the high prices of important commodities in order to prevent profiteering.

General Mulcahy

A serious danger has arisen for all sections of the community, due to these things.

Mr. Lemass

The first and obvious question that arises in this discussion is price control. We have had only one suggestion, the suggestion that all prices should be pegged forthwith regardless of the consequences. I think that is a bad suggestion. Let me say, however, that to some extent it has been adopted because, in regard to all essential commodities, there are at the moment price Orders in force, price Orders which limit the prices which may be charged for goods or the profits that may be taken by traders on the sale of goods, and the traders concerned cannot exceed these prices or these profit margins unless another Order is made amending the Order now in force. Other Orders are being made, however, as occasion arises, and, when deciding on the making of additional Orders, the factors that have to be taken into account include not merely the cost of production, the cost of materials used in production, the wages paid in production or other charges of that character, but also the effect of a change in price upon the total supply available and on the prospects of continuing supplies in the future.

Price control is a comparatively simple matter for some goods. It is comparatively simple for goods that are sold in uniform quality, such as sugar, butter, bread, flour and cement. It is not quite so simple in the case of goods that are sold in a multitude of varieties. The outstanding examples of such goods are drapery products, vegetables and certain household utensils. In their case it is clearly impracticable to regulate prices by the method of fixing the maximum prices to be charged. For bread, butter, sugar, tea, cement and other commodities of standard quality, a fixed price is determined and made enforceable by law. That price takes account of the cost of manufacture and the reasonable allowances to be made to distributors. Everybody knows that price; it is advertised frequently in the newspapers and there is little difficulty as a rule in making it effective.

In the case of goods sold in a multitude of varieties, like shirts, socks, suits of clothes and vegetables, it is impracticable to fix maximum prices. Consequently, the method of control is based upon a limitation of the margins of gross profit that may be taken at the various stages of production or distribution.

For some commodities—and I would include a number of farm products in this class, particularly vegetables, to which reference has been made here— no system of control is practicable that does not include State trading in these goods. I do not know if the Dáil is prepared to conclude that the price situation existing here is of so serious a character that we should institute a system of State trading in necessary goods. Deputy O'Higgins, who has frequently denounced the Government for its supposed desire to extend State supervision or State control of business, and who has frothed in his usual manner in denunciation of the growth of bureaucratic intervention in business, nevertheless regards it as legitimate to criticise the Government for every failure of private enterprise to produce or distribute fairly the goods in which it is dealing. Most of the examples he gave of distribution difficulties, and of temporary scarcities which arose during the war, were difficulties or scarcities created by the failure of private firms to function efficiently. Perhaps their efficient functioning was impeded by temporary difficulties associated with the emergency, but if the Government are to be held responsible for that failure it is a fair question to put to Deputy O'Higgins and his colleagues whether they contemplate that the Government should take control of these activities and eliminate the private trader from them.

There are two branches of price control, and rationing is one of them. Rationing is, from many points of view, the most important branch of price control. The aim of rationing is to reduce the effective demand for goods to the available supply and thus prevent demand forcing prices to an uneconomic level. I spoke in the Seanad, on the motion moved there last week concerning prices, about the importance of public co-operation in relation to this problem of rising prices. I am sure it is not necessary to repeat here what I said there, except to emphasise that in the term "public co-operation" I am including the help and assistance of traders as well as of the purchasing public. I may say that in the type of economy that we are operating, if we are to prevent the extension of the activities of the State over too wide an area of business we cannot make rationing or price control effective without getting more public co-operation than we have been getting.

Every Deputy knows that public goodwill was never behind our rationing system. On every occasion that a trader was convicted in the courts for the offence of selling goods contrary to rationing regulations or at prices higher than those fixed by law, he had no difficulty in getting a petition signed by every prominent citizen in his locality, including frequently the Deputies for his constituency, to relieve him of the penalty imposed by the court. It may be that with the passage of time the attitude of the public has changed, but we have got to rely upon public co-operation, public understanding and the goodwill of traders in making our system work, or else we have to abandon that system and establish a socialised State, one in which all productive and distributive activities are conducted by the State, or so closely supervised by the State as to mean the same thing.

One of my main objections to the motion on the Order Paper, like my objection to the motion moved in the Seanad, is that it tends to create in the public mind the idea that there is some easy method in the power of the Government to devise, by which prices can be prevented from rising or existing prices can be reduced. That is not true. If we are to deal with this problem of prices in a realistic way, we must have regard to all the facts and we must limit the Orders that we make to practicable aims, convince the public that these Orders are made in their interest, that they are practicable and get the public to help us to make them effective. I do not know that there is any Deputy in this House who, in 1939, did not expect prices to rise. During the course of the discussion here, Deputies spoke as if there was some prospect at the outbreak of the war that we could prevent a rise in prices here. I feel certain that if Deputies in 1939 had been told that circumstances would develop by which the cost of goods imported into this country would rise on the average by 122 per cent., that the prices paid to farmers for the foodstuffs produced and sold by them would increase on the average by 90 per cent., and if they were asked by what percentage in these circumstances they anticipated our retail prices would rise, not one of them would have the audacity to suggest that our price level would rise by only 70 per cent. I think it is some indication of the effectiveness of the system of our price control that while the cost of imported goods is 120 per cent. higher than before the war, while the cost of agricultural produce is 90 per cent. higher than before the war and the wholesale prices level is 98 per cent. higher than before the war, in retail prices, so far as they are reflected in the cost-of-living index, the increase is 70 per cent.

Deputy Larkin asked if we meant to publish the weighting given to the various commodities, the price of which is taken into account in preparing the cost-of-living index. So far as I know, the report of the commission which conducted an inquiry into the family budgets of workers in 1922, a commission presided over by Mr. Thomas Johnston, then Leader of the Labour Party, was published and is available to Deputies in the Library of the Dáil.

Deputy Norton and Deputy Larkin stated that we stabilised wages but did not stabilise prices, that we stabilised wages on the promise that we would stabilise prices and failed to keep that promise. I should think one of the first, if not the first, Order made under the Emergency Powers Act was an Order pegging prices. That Order did not remain long unamended. In the early days of the war we were naturally concerned to increase to the maximum the inflow of goods into this country and when importers reported to the Department that supplies were available at higher prices than had previously prevailed and that they were prepared to bring them in if the Standstill of Prices Order was modified, we naturally modified the Order to encourage imports. The practice then applied was to permit of increases in the price of products of a particular manufacturer only if he could show that the cost of materials used by him had increased and to permit only of such an increase as the actual rise in the cost of materials justified. That system could not be maintained because eventually it created a situation in which the commodities produced by one manufacturer were required to be sold at a different price to similar commodities produced by another manufacturer. We had no reason to assume, and Deputies I am sure would not assume, that when two articles of equal quality produced by different firms reached a retail trader at different prices, they were not sold by him at different prices, and it would have been impossible for him, having regard to the conditions which then existed, to have done so.

That system of control was amended and, in substitution therefore, we endeavoured to control the prices of manufacturers on the basis of fixing the gross return they should receive from their activities in relation to the capital employed in their businesses. That seemed the obvious system, and from the point of view of prices particularly it was the ideal system, but it had a clear defect in it in so far as it did not give to any trader or manufacturer an incentive to maintain his output, or increase his output because profits were related to the capital employed in the business and he could aim at securing that profit even on a diminishing output. Consequently, it was abandoned in favour of a system, which was maintained during the whole of the war, of regulating manufacturers' prices on the basis of gross profit related to production, a system which gave a manufacturer the maximum encouragement to increase his output or maintain it as best he could. With the end of the war, the system was changed to that now operating. It is based upon fixing net profit per unit of output. That system also has its defects, but it is the one which is the most suitable to present circumstances and has been effective in keeping the profits of manufacturers within reasonable limits.

General Mulcahy

When was that introduced?

Mr. Lemass

In 1945. Although price control was begun after the first week of the war, wage stabilisation, to use the term employed by Deputy Norton and Deputy Larkin, was not made effective until 1941. I do not think that the term "stabilisation" is an accurate term. The wage Order then made did not, in the first instance, apply to agricultural workers, and since the beginning of the war the wages of agricultural workers have increased by 84 per cent.

Mr. Dillon

From 24/-

Mr. Lemass

It did not apply to the lowest paid industrial workers, and after the introduction of the bonus system, increases were permitted which in the case of the lowest paid workers, gave them a compensation which was proportionate to the rise in the cost of living. Between the beginning of the war and the date of the repeal of the standstill Order the index of industrial earnings showed a net increase of 40 per cent. over that period. It is not true that prices were not stabilised. The wage control Order came into operation in 1941 and by 1943 prices in this country were stabilised. From 1943 to the end of 1946, there has been no rise in prices here. I do not say that the prices of individual commodities have not fluctuated. They have, but all the price of indices prepared by our Statistics Branch and published in the Trade Journal show a stability in our price situation from 1943 until now.

Mr. Dillon

That is fantastic nonsense.

Mr. Lemass

The Deputy can suggest that these statistics are inaccurate, that the Statistics Branch is working on inadequate or inaccurate information, but I do not think he will convince anyone that that is so.

Mr. Dillon

Am I not selling the goods every day of my life?

Mr. Lemass

If necessary, I can produce here a list of the goods subject to price control and show the fluctuations in their prices that have taken place since 1943. I gave a list of some goods in the Seanad and Deputies can see it in the Official Reports of the Seanad debate—a list of goods the prices of which affect the cost-of-living index and which have not risen since 1943 and a list of goods which have fallen in price since 1943. It is, however, as Deputy Mulcahy said, not important that we should hold now an inquest upon the war years. We are concerned with the present situation and the situation which may develop in 1947. We have to consider: have prices risen unduly? Have they risen because of circumstances within our control which we could have prevented from operating to the extent they did? Is there anything we can do now that will lower present prices or prevent a future rise?

Mr. Dillon

Yes.

Mr. Lemass

The main causes operating to increase our prices are, first, the cost of imported goods, and that includes the cost of imported industrial materials which affect the cost of manufacturing goods here; secondly, the cost of agricultural products; thirdly, wages; and, fourthly, and to a very minor extent, the overhead charges and profits of manufacturers and traders. So far as imported goods are concerned, it is quite clear that it is only to a very limited extent that we can take action which will reduce them. We have taken that action wherever practicable. Where it seemed that centralised purchasing of these goods by one organisation here would bring down their price, centralised purchasing has been arranged for In respect of a substantial range of important commodities, there are either companies set up by the State buying in bulk our total supplies or arrangements to the same effect have been made by the trading organisations concerned.

The indications are that imported goods are not falling in price. I do not want to quote unduly from statistics published elsewhere, but in so far as Deputies may be under the belief that prices are falling elsewhere and that we should expect a similar development here, I think it necessary to emphasise that prices elsewhere are rising, and not falling. I gave certain figures to the Seanad in that connection and quoted certain publications of other Governments. I do not want to repeat these figures or these quotations which are available to Deputies who want to study them in the Official Reports. Since I spoke in the Seanad, the American Bureau of Labour Statistics published its index figure for January 11th, 1947. The general price index for the United States of America on January 11th was 140 as compared with 106.7 for the same date in 1946 and 139.1 for the 4th January, 1947, the week previous. Since I spoke in the Seanad, another issue of the British Trade Journal has been published, the issue for January 18th, 1947. I will quote from that journal:—

"The rise of 6.2 per cent——"

That is to say, the rise in wholesale prices:—

"——between December, 1945, and December, 1946, was the cumulative result of an almost unbroken upward movement throughout the year."

Later in the same article, it is stated:—

"Iron and steel and non-ferrous metals have risen more in 1946 than in the whole of the five previous years."

It is quite obvious, in view of the general trend elsewhere, that our capacity to effect a reduction in the prices of imported goods is almost negligible. We may, by good buying or by perfecting the mechanism of our buying organisations, achieve economies here and there, but no general downward trend in the prices of the goods we have to import can be expected in the near future. I have no doubt that a downward trend will develop at some stage, but it has not begun yet.

Is there any Deputy here who will urge that the prices now paid to farmers for their produce should be reduced?

Mr. Corry

They are going up—they have to go up.

Mr. Lemass

In so far as the cost of foodstuffs has risen, the rise has been almost entirely due to the increased prices paid to farmers. If any Deputies have doubts upon that subject, I should like to give them certain comparative figures. From the Irish Trade Journal I have calculated the increase which has taken place in the retail prices of certain specified articles between November, 1938, and November, 1946, and from the same publication, the issue of June, 1946, I have calculated the increase in the prices paid on the farms to farmers for farm produce from 1939 to 1945—the most recent figures relate to 1945.

According to the national average retail prices of commodities ascertained by the Statistics Branch, published in the Trade Journal and used for the preparation of the cost-of-living index, the price of beef has increased, since 1938, by 57 per cent. During the same period, the average price realised by farmers for cattle increased by 64 per cent. A leg of mutton increased by 74 per cent., while the average price realised for sheep sold off farms was 134 per cent. higher in 1945 than before the war. The price of bacon has risen by 71 per cent. and the price of pork by 60 per cent.

Mr. Donnellan

I thought you were not going to quote what you said in the Seanad.

Mr. Lemass

These are not quite the same figures. During the same period, the price paid to farmers for pigs rose by 177 per cent. The price of creamery butter is 51 per cent. higher now than before the war. The price of milk delivered to creameries has risen by 105 per cent. I will make no point at the moment concerning the incidence of subsidy in keeping down the price of butter. In the November quarter of 1946, eggs were 19 per cent. higher than in November, 1938, although the average price realised for eggs by farmers during the whole of 1945 was 119 per cent. higher than in 1938. The explanation of that considerable difference is, I think, to be found in the fact that the increased price realised by farmers for eggs operated mainly in the periods of peak production and not in the periods of winter scarcity.

The retail price of fresh milk has risen by 18 per cent. The price of fresh milk sold off farms by farmers has risen by 71 per cent. The price of bread has risen by 29 per cent. The price paid to farmers for wheat has risen by 93 per cent. The price of oatmeal has increased by 53 per cent., although the price realised by farmers for the oats they sold rose, between 1938 and 1945, by 159 per cent. The price of potatoes retail increased by 112 per cent. The price realised by farmers increased by a precisely similar percentage. The price of sugar rose by 33 per cent., while the price of beet increased by 74 per cent.

Mr. Davin

What are you getting out of the recent 1d.

Mr. Lemass

Deputy Larkin referred to the recent increase in the price of sugar and he said that the additional 1d. represented profiteering by the sugar company and would give it a sum of money in excess of that required to offset the losses resulting from the strike. It is not even sufficient to offset those losses.

Mr. Davin

Give us the figures.

Mr. Lemass

I have not got the figures now but I can assure the Dáil that the losses experienced by the company, in consequence of the strike and the higher production costs arising out of the decrease in total output this year, coupled with the increase in wages paid to the workers and the compensation paid to the farmers for the losses to them during the strike period, will not be fully recovered to the sugar company by the increase of 1d. in the pound of sugar.

Mr. Donnellan

What was the amount paid to the farmers for the losses?

Mr. Lemass

I have not got those details. I want to say this however— and it is important that the Dáil should realise it—that we are now endeavouring to buy sugar elsewhere to import in here and the cheapest sugar we can buy and import into this country will be available here at a price which will enable it to be sold, without profit to anybody, at about 9d. per 1b. —50 per cent. higher than the present price. I am not saying that that price will be charged but we could not anywhere buy sugar at a price that would enable it to be sold at less than 9d. per lb.

Mr. Davin

How much will you get out of the 1d. in the lb. What is the relation in the 7/6 for beet as against the 1d. in the lb.

Mr. Donnellan

There will be £500,000——

Mr. Lemass

The Deputy's interruption is quite unintelligible to me and I think to everybody else. The main factors in determining the level of prices are the cost of imported goods, the cost of farm products, wages and profits. We are told that profits have increased out of all proportion. We are told that, in the main, the high prices now operating are due entirely to manufacturers and traders charging exorbitant prices in order to make exorbitant profits. I stated in the Seanad that the least significant item in determining the retail price of goods is the profit taken by the manufacturers. I gave the instance of the boot manufacturers. I think that is a suitable example because it brings the issue clearly before the mind of everybody. The average profit allowed to boot manufacturers under our system of price control varies from 4d. to 8d. per pair according to the class of product and it will be obvious that variations in that profit up or down can have little or no effect upon the retail prices operating in the shops.

Mr. A. Byrne

What about sugar and clothing?

Mr. Lemass

A census of industrial production is taken every year and the result of the census is published in the Trade Journal. Deputies can study there the ascertained results of the operations of manufacturers in each year of the war. They will find under the heading which is used to denote the remainder of the net output, that is to say the gross value of the output less the cost of materials, wages and salaries, and which represents the fund from which rent, rates, royalties, taxes, depreciation, appropriations to reserve and dividends are paid, that it decreased from 17 per cent. in 1938 to 16 per cent. of the gross output in 1944.

We are told, not merely here but in letters to the Press, that the prices of goods to our people are unduly inflated by reason of the exorbitant profits taken by traders. In support of that contention reference was made here to the published accounts of public companies operating multiple stores. Now I can, if Deputies wish, operate a system of controlling traders' margins on the basis of fixing an individual margin for every trader or I can maintain the present impartial system of fixing a margin which takes account of the circumstances of all traders and which seems to me to be fair to all traders. That margin, admittedly, may give one trader a higher profit than I would think reasonable and it may give another trader a lower profit than I would think reasonable. But I would warn the Dáil—and in particular, the Labour Deputies—against drawing any conclusion as to the adequacy of the margin allowed to retail traders in this country upon the basis of the published returns of large companies operating multiple stores.

Retail trade in this country is carried on in the main by small shopkeepers who are hard workers and who get, in return for their labours, much less over the year than the average tradesman. Before the war, we took in this country a census of distribution and we have got available to us information concerning our distributive trades that few other countries have, because few other countries have attempted to take a census of distribution. Great Britain has not taken one yet. We know from that census of distribution that before the war 84½ per cent.—more than four out of every five of the retail shops in this country —had a total turnover in the year of less than £2,500. Of the shops doing a business involving a turnover in excess of £10,000 in the year, those in all trades did not exceed more than 2.4 per cent. of the total. Those in the grocery trade did not exceed 1.8 per cent. of the total. Those in the drapery trade did not exceed 5.4 per cent. of the total and those in the butchering business not more than 1.7 per cent. of the total.

All these figures are available to Deputies in the published returns, together with other figures relating to other trades. I want to emphasise to the House, however, that the conclusion to be derived from those figures is that the retail business of this country is, in the main, done in small shops by people who are certainly not making large incomes from the operation of those shops. We fixed the margin of gross profit which can be taken by retail drapers. That margin was reduced not altogether because we found that it was yielding too high a return to the traders but because we considered that a reduction was justifiable in view of the increasing prices of goods, which increased the gross amount of money which the margin brought to the traders' pockets and because circumstances were operating to ensure that the normal risks of retail trading—the risks of bad stock, the risk of slow business—no longer operated and that with the present conditions of quick turn-over and quick clearance of stocks a margin similar to that prevailing before the war was not required.

The British Government have, presumably for the same reasons, reduced their margins recently, but even their lower margins are substantially higher than those we are permitting. It may be that these margins are too high. I think that would have to be demonstrated. I do not think they are too high. I have certainly had no evidence to that effect. I know here and there on the basis of these margins some traders will make good profits, and I know that here and there, from the urgent representations I have received, some traders are making insufficient profits. But, taking the retail trade as a whole, I think they are fair margins to allow. They are, however, capable of being reviewed. They are not like the law of the Medes and the Persians. They can be adjusted as circumstances appear to justify. But I will not accept from the House the contention that traders are making, on the basis of these margins, undue profits. I think in the interests of the traders any Deputy who advances that contention should make some effort to prove it. I know, as Deputy O'Higgins said, that some traders may be breaking the law. It is quite possible that there are drapers who sell goods otherwise than against rationing coupons. It is quite possible that some traders detach the labels stating the fixed price of the goods before selling them at a higher price to the public. I do not think the volume of such transactions is very considerable but, to the extent that such transactions do occur, they cannot be eliminated entirely by the activities of inspectors of my Department; they can be eliminated entirely only if we get the whole hearted co-operation of the public and particularly co-operation in the form of a refusal to purchase at prices in excess of those fixed by Order.

I am told here that butchers are making exorbitant profits. I have had an examination made of the business of retail butchers in Dublin and I am quite satisfied that, under present circumstances, there are very few butchers in Dublin making a profit at all. I am satisfied that the profit made by them in 1946 was not in any way exorbitant. They have claimed that prices should increase. This business of meat prices in Dublin has been be-devilled by certain newspapers publishing false reports. Time and again in the last fortnight they have announced that the butchers have increased their prices although they had not done so. They have announced in the last few days that butchers have decided to defy the Minister for Industry and Commerce and to increase their prices without his consent. That is not true. Why are these papers publishing these false accounts unless it is in the hope that they will stampede the butchers into doing something which in turn can be used as a political stick with which to beat the Government? They have succeeded in doing it in some cases, I agree, because, on the strength of these reports in the newspapers as to the action of the Dublin butchers, butchers elsewhere throughout the country have increased their prices. I am not going to say whether they were justified in doing so or not, but the Dublin Master Victuallers' Association have given me an undertaking on behalf of their members that they have not increased their prices and will not increase their prices until they have reached agreement with me on the subject.

Let me say, however, that, having regard to the rise in the cost of animals sold in the Dublin market, they are entitled to an increase in price. They are claiming an average increase of 1.1d. per lb. for beef and 4½d. per lb. for mutton. The present prices they are charging were fixed in January of last year.

On the 16th January, 1946, according to the information available to the Statistics Branch of my Department, prime bullocks and heifers fetched an average price of 68/1¼ per cwt. on the Dublin market; prime wethers and hoggets fetched 100/6½. On the corresponding date in the present year the price of bullocks and heifers had risen to 72/3¼; the price of wethers and hoggets had increased to 132/7. In the meantime, also, the operating charges of butchers have risen and particularly they have had to meet an increase in wages to their operatives.

Whatever increase does in fact operate will be determined in the light of the facts but I want it to be stated here, in fairness to these butchers who have operated a price control, that is not enforced by a legal Order, during the years of emergency, in agreement with my Department, that they are not making and have not made during the past years profits which could be regarded as unreasonable, that they are not making at present even reasonable profits, and I make that assertion having had an examination made of the audited accounts of a representative number of the firms concerned.

Now, we could perhaps reduce the price of meat if we prohibited the export of cattle or took other measures to bring under control the price of cattle offered for sale in the Dublin market. Let it be quite clear that you cannot expect to lower the price of meat unless the price of cattle is reduced also. It is, I think, impracticable to devise a system of subsidising meat that does not involve State trading in cattle. It may be that members of the House would contemplate such a development but let it be quite clear that that is involved in it, that neither control nor subsidy can be made effective unless the State buys the cattle from the farmer at a price that is considered fair to the farmer and sells them at the lower subsidised price to the butcher who is going to retail them as meat.

I turn now from foodstuffs to industrial products. I cannot give precisely the same tables concerning retail prices and manufacturing costs as I gave for foodstuffs because the variety of industrial products is too great and the number of materials that are used in the production of any one product is too large to permit of a reasonable calculation as to changes in cost.

Mr. Dillon

Start with electric lamps, now.

Mr. Blowick

Or agricultural machinery.

Mr. Lemass

I will deal with electric lamps, certainly. So far as suits of clothes are concerned, the national average price of a ready-made suit of clothes, according to the information collected by the Statistics Branch and used in the compilation of the cost-of-living index, increased between August, 1939, and August, 1946, by 78 per cent.

General Mulcahy

Would the Minister say the prices?

Mr. Lemass

The information the Deputy wants is published in this week's Official Reports in a written reply to a Dáil question by Deputy Larkin.

General Mulcahy

We will see it when it comes.

Mr. Lemass

During the same period the price of woollen cloth increased by 154 per cent. The price of a cotton singlet, according to the ascertained national average retail price, increased by 48 per cent. The price of cotton yarn imported and used in the production of these goods increased in the same period by 246 per cent.

Mr. Dillon

Do you believe the figures for the cotton singlet that I sold at half a crown and am getting 12/6 for now?

Mr. Lemass

The average national retail price of shirts increased by 80 per cent.; the cost of shirting increased by 250 per cent. One can go through all the various commodities produced by various industries here and ascertain the increase in price of materials which they have experienced. All that information is published in the Trade Journal and Deputies can work it out for themselves.

Take the result of industrial working as a whole. Between 1938 and 1944— 1944 is the last year for which complete figures have been published—the value of the gross output of Irish industry increased by 44 per cent. The cost of materials purchased by Irish industrialists and used in manufacture increased in that period by 50 per cent. According to the Production Index published by the Statistics Branch of my Department, the total volume of industrial production in 1944 was 83 per cent. of production in 1938. It may be of some help to Deputies who are perturbed about out ability to improve on our output to note that the most recently published figure, that for November, 1946, showed production in that month had reached 107 per cent. of the 1938 figure.

Mr. Norton

In price or in volume?

Mr. Lemass

In volume of production.

Mr. Norton

And how much in price?

Mr. Lemass

Prices rose much more than that. It is true that some industries have been more affected by the drying up of supplies during the emergency than others and have not yet recovered their pre-war production level. Others have progressed considerably beyond it.

Mr. Cosgrave

Is that an average over all industry?

Mr. Lemass

Yes. In 1938 the cost of material used in manufacture was 66 per cent. of gross output; by 1944 it had risen to 69 per cent. I have had taken out figures showing the gross profit secured by manufacturers of certain typical classes of wearing apparel —men's outer garments, women's outer garments, hosiery and underwear, and waterproof garments. In 1939-40 the gross profit earned by those manufacturers was 11.5 per cent. of the value of their production; in 1945-46 it was 10.2 per cent. During the years 1938 to 1944 salaries and wages in all industries fell from 17 to 15 per cent. of the value of the gross production. Employment given in those industries fell 14 per cent. The remainder of the net output fell from 17 per cent. to 16 per cent.

At the beginning of this debate I sat here with a notebook in my hand and I wrote upon the first page the word "Suggestions". I reserved the other pages for the comments of Deputies. The first page is almost virgin. There was one suggestion made—that by Deputies Norton and Larkin, to which I have referred, that we should peg prices now regardless of the effect on supplies and on unemployment. There were no other suggestions. If we are to face this problem of price regulation and have regard to the social consequences now of rising prices and other things to which Deputy Mulcahy referred, we must pool our wisdom. We must get from Deputies a different kind of approach to questions.

They may find whatever fault they like with the Government, but at the same time they must give us the benefit of concrete suggestions as to how prices may be brought down. I have told you that the rise in prices of goods here is attributable to certain main causes—the increased cost of imported goods, which we cannot alter, the higher prices paid to farmers for their produce, which we do not want to alter, the higher wages and to some extent higher overhead costs. I contend that the profits earned in manufacture and distribution, to the extent that they can be controlled by the Department, have been regulated so as to avoid giving an undue return to any individual, in so far as that can be secured by arrangements which are applicable to all firms in a trade and are not specifically related to the circumstances of individual firms. To avoid misunderstanding, I want to emphasise that the control of manufacturers' profits is upon an individual basis.

Deputy O'Higgins referred to what he called the lunatic system of selling vegetables and other farm produce in Dublin and urged that the system should be abandoned. He urged that we should set up a committee to examine that system and see what changes could be made. Apparently, he does not know that a commission set up for that precise purpose published in 1940 a report which is available to all Deputies—"The Report of the Fruit and Vegetables Tribunal"— which deals with that precise matter, the method now in force for the sale of farm produce in Dublin. The report is a long one. I am not going to deal with it, but I might read one sentence from its final paragraph which is symbolical of its recommendations:

"In Dublin, where there is a fully organised wholesale market, we are of opinion that direct dealing between growers and consumers should be discouraged. The majority of the County Dublin growers, for example, disapprove of such direct dealing and are satisfied that their interests would in the long run be best served if all produce were brought to the Dublin wholesale market. Some growers deal directly particularly with hotel proprietors but their brother growers would prefer that they did not."

I refer to that report and read that quotation from it merely to emphasise that, far from the system in operation for dealing in vegetables and fruit for the Dublin market on a wholesale basis being the lunatic arrangement Deputy O'Higgins referred to, it is an arrangement which a commission which investigated marketing systems in this country and all over Europe decided was the most suitable. I am not saying that their view is necessarily correct, nor am I saying that circumstances have not changed since the report was published. I am not saying that they did not suggest certain minor adjustments in that system, but the general basis of their conclusions and of their recommendations to the Oireachtas was that no substantial change was desirable.

The Government is not antagonistic in principle to the policy of price subsidisation. In so far as Deputies have expressed apprehension concerning the inflationary trend getting out of control, one of the most effective methods of encouraging the growth of inflation is the subsidisation of prices by borrowed moneys. If we subsidise prices out of taxation—imposing taxation upon sugar to give a subsidy on tea or on tea to give a subsidy on sugar— there does not appear to be much sense in it.

Therefore, if there is to be any question of price subsidisation as a temporary device to get us out of current difficulties, there has also to be a decision that the cost of subsidisation will not be recovered in taxation but be met by borrowing. That is a method of inflation. It is the method which has, in the past, been applied to keep down the prices of certain goods. It is in operation to some extent at the moment. If Deputies want an extension of that system, I ask them to turn their minds to the practical problems to which it gives rise.

I have mentioned meat prices. Can they devise a system of subsiding meat on a national basis which does not involve the establishment of a central trade organisation, the activities of which the Government must control? Can they devise any system of subsidising vegetables that does not involve centralising of the sale of vegetables in some one board or organisation through which the subsidy can be made effective? I do not think Deputies will succeed in doing that. In the Seanad, I asked them to remember the experience of Soviet Russia, where there was a totalitarian State, under a Government possessing drastic powers, which did not hesitate to use them and which had to use them in full in its efforts to compel farmers to sell their farm produce, and particularly their garden produce to the State trading organisations. It did not succeed in doing so; in the end, the Government had to withdraw from its position and permit a certain amount of individual trading in those commodities.

Again I reminded them of the experience of the U.S.A., where they attempted to apply restrictive methods of price control in relation to farm produce. The Government was beaten. The farmers won and price control disappeared. If we are to attempt to control or subsidise the price of vegetables, we must contemplate facing immense difficulties in bringing into existence the organisation required for that purpose. Vegetables are dear. I do not deny that. Everybody knows that last year was a bad year for some vegetables and that, to the extent that the supply has been curtailed, the price has risen.

I was asked why the price of potatoes was fixed at its present level. We fixed the price of potatoes earlier this year than previously. We fixed a price for potatoes in Dublin, although no scarcity was anticipated. We feared that the introduction of bread rationing would lead to some movement on the part of the farmers to hold potatoes off the market or to some inclination on the part of traders to reduce supplies. We fixed the price not merely for the current period but right through the season until the new potatoes will be available. We did that to give traders an idea of the prices to be charged through the season and farmers an indication of the benefit they would secure if they withheld their potatoes now and marketed them later. There are, of course, different varieties of potatoes. Deputy Norton referred to potatoes at 1/5 a stone. While the "Up-to-date" variety of potatoes costs 1/8, the Arran Banner type sells at only 1/4. The price fixed by Order is the maximum, the price that will be paid for the dearer varieties. Presumably, a lower price, so long as the supply position does not deteriorate, will continue to operate for the other varieties. There is no immediate risk of a scarcity of potatoes. As the Deputy knows, it is not possible to have precise figures as to the supply, because the supply is very largely determined by the price and also by the price of other animal feeding-stuffs available to farmers.

We could make an Order, if Deputies so desired, reducing the price of potatoes to 1/- a stone, but, if we fixed that price, I should be surprised if a single cart-load of potatoes would come to the Dublin market. Always remember, in fixing the price of potatoes, that the farmer, in nearly all cases, has an alternative use for his crop and will put it to the alternative use if he thinks it is going to pay him better. To a considerable extent, the price we fix determines the volume of supply and, if we were unduly restrictive in fixing the price, we should reduce the volume of supply. The difficulties about subsidising meat and vegetables apply equally to all goods which are produced in excess of our requirements, even if the excess production is on a seasonal basis. I am thinking, particularly, of eggs and certain varieties of fish. Again, it is not possible to reduce the price of those goods, or subsidise their price, without establishing systems of trading which would involve considerable difficulties. We subsidise the price of bread, butter, tea, and turf. We could increase the subsidy——

Mr. Dillon

Tea is not subsidised now.

Mr. Lemass

There are varieties of tea available to which the subsidy applies. By increasing the amount of subsidy available in respect of that tea, we brought the price down last year from 4/- to 3/8. If the Deputy can think of any way by which that could have been done, otherwise than by subsidy, I should be glad to hear it.

Mr. Dillon

You did not subsidise any of the tea I bought.

Mr. Lemass

As regards subsidising the price of flour, hitherto we had to take into account the possibility of flour being used for animal feeding if the price was brought into closer relationship with the price of other animal feeding stuffs. That danger is not as great as it was, now that we have a flour and bread rationing system, but I should not like to put our rationing system to a test by giving an inducement to stock-feeders to use flour if they thought it was cheaper for them to do so than to use other feeding stuffs. As regards butter, a substantial proportion of our total production is farmers' butter, which cannot be subsidised unless we adopt the system operating in Great Britain and require the farmers to sell all their butter to a nominated buyer in an adjacent town. We subsidised the production of creamery butter only, and the price of creamery butter determines the price of farmers' butter.

In the case of turf, I think that it would be undesirable to bring the price in the non-turf areas lower than it is. It is always questionable whether the State is entitled to impose a charge on the whole community for the benefit of a section. The price of turf in the turf areas is not subsidised. It is now as high as, and sometimes higher than, the subsidised price in the non-turf areas. If the turf supplies in the non-turf areas were further subsidised, there would be a legitimate grievance on the part of those members of the community who would not benefit by that subsidy.

May I say this in relation to Deputy Norton's point concerning the excess corporation profits tax, that it is entirely groundless to suggest that the Government encouraged people to earn excess profits for the sake of the revenue they would get from these excess profits.

Mr. Norton

Did they not, in fact, get it?

Mr. Lemass

When we decided to increase the corporation profits tax, we used the term "excess profits" for propaganda purposes. It is now coming back to roost. Deputies are using it for propaganda purposes against the Government. The tax did not merely apply to "excess profits" in the ordinary meaning of the term. Many of the firms who paid that tax, and paid heavily, were making profits less than the Department of Supplies would have considered reasonable. Some of the firms which escaped the tax would still have escaped it even if they had been making double the profit which we would have considered reasonable. Profits were regulated by the Department of Supplies, so far as it could regulate them, without any regard to the effect of the Department's activities on the revenue position. When Deputy Norton refers to the fact that the first £2,500 of profits was exempt from this tax, he conveniently forgets that corporation profits tax did not previously apply to the first £5,000 of profits. That exemption was substantially reduced when this new tax was introduced.

Mr. Norton

That had no meaning in view of what they got away with.

Mr. Lemass

It meant that people paying ordinary corporation profits tax had to pay more. I do not want it to be taken as my view that the increases in wages now occurring will not cause an increase in prices. I dispute the contention that they must necessarily cause a proportionate increase in prices but it is foolish to pretend that the one remaining factor affecting prices which is increasing, to our knowledge, will not ultimately raise the price level. Of course, it will. The Deputy referred to bread. We subsidised the price of bread. There are a number of bakers in Dublin. Some of these bakers are making good profits. Some of them are making these profits mainly on confectionery. Some of them are making profit on batch bread and some are making no profit on batch bread and are kept in production of batch bread by the subsidy.

They may be making a profit on their total trade. Notwithstanding the subsidy on batch bread, some bakers are making a loss, even considering their business in confectionery and fancy bread. It is not easy to operate a system by which to subsidise the bread price in that set-up. It is necessary to require everybody producing bread to sell at the same price. They all get flour at the same price. They all pay the same wages. Some are making profits and some are making losses. The bakers employed by these firms went to the Labour Court and got a recommendation from it for an increase in wages which is, I think, on the average equivalent to about 30 per cent. on the present rates. That is going to mean 2d. on the loaf, and there is no possibility of avoiding an increased charge upon bread in Dublin equivalent to 2d. in the loaf unless the Government decides to increase the subsidy. There is no reserve fund which could be used or no economy possible which would avoid the effect of that wage increase upon the price of bread.

Córas Iompair Eireann was also referred to. Córas Iompair Eireann is facing wage increases already agreed to by the company or pending which will increase its wages bill by £1,000,000 a year. There is no possibility, in present circumstances, of off-setting that big increase by economies, by more efficient equipment or by reducing other expenses. In fact, in present circumstances everybody knows that economies are impossible and that other expenses are going up. Their services are being curtailed and revenue is going down. Again there is no possibility of avoiding an increase in some of the charges of that company in consequence of wage increases.

One could go through the whole field of industry and show that, in individual cases, the full impact of wage increases will be immediately reflected in prices. I do not agree that it is necessarily so in all cases, or that the average rise in prices will be sufficient to deprive workers of the benefit of the increased wages they may receive. I think that in many cases it will be possible for the firms concerned to carry the cost of the higher wages on profits, having regard to the remission of the excess corporation profits tax. In many cases the rise in production, which is now taking place, will tend to offset the effect of the ultimate rise in prices. I think it is foolish for anyone to think, or suggest, that a rise in some prices can be avoided as a result of the rise in wages that is taking place. Of course, there will be a rise. Of the three main factors—the cost of imported goods, the cost of agricultural products and the cost of wages—the cost of imported goods is not going to come down, and neither is the cost of agricultural products and the cost of wages is going up. There is certain, therefore, to be an upward movement unless it can be offset by an increased output of goods resulting from an increase in the availability of materials or other causes. If we could, in fact, get increased production or increased imports, and increased activity in industry and trade and increased supplies generally, then there is no reason to fear that the increase now taking place either in wages or in the cost of cattle or the insignificant expenditure on tourists, or other factors in our national accounts will cause an inflationary tendency which cannot be controlled.

I am against the motion and against the amendment. These problems are not of our creation, and we are not going to succeed in solving our problems if we try to hoodwink the people into the belief that there is some simple system which can be applied by the Government, or discovered by a committee, which will offset a rise in prices. That is not true. It is not serving the national interest to suggest that it is true. I believe that the Dáil in passing the motion or the amendment would be conveying that idea, and that is why I hope the Dáil will reject both.

Deputy Dillon rose.

Mr. Norton

Would the Deputy allow me? I take it that the debate is to conclude at 10 o'clock.

An Leas-Cheann Comhairle

Yes.

Mr. Norton

I simply want to get the position clarified.

Mr. Dillon

Is the Deputy raising this because I have given notice to raise a matter on the Adjournment?

Mr. Norton

This discussion has not been unhelpful. Very few Deputies have spoken. I am anxious to know if it is possible to agree to allow the motion to run into Private Members' Time on some day next week.

Mr. Lemass

There are other motions on the Order Paper in Private Members' Time, and this motion would not be entitled to priority over them. I think myself that there will be other opportunities for discussing this subject in the near future, on supplementary estimates and on the main estimates, and that it is not necessary to carry this discussion into next week.

General Mulcahy

On the point raised by Deputy Norton, we would be agreeable if the discussion could be carried into Private Members' Time next week.

Mr. Lemass

As I have pointed out, this will be the last of the motions in Private Deputies' Time if it is carried over, and there would have to be complete agreement in all parts of the House before discussion on it could be continued next week.

General Mulcahy

In so far as we can make any contribution to complete agreement on that point we are prepared to do it.

Mr. Lemass

There will be a number of opportunities in this session to discuss this question. There will be supplementary estimates of various kinds and ultimately the main estimate. There will, as I have said, be ample opportunity for discussion. This is likely to be the main topic for debate during the session.

Mr. Costello

Why not give Government time to discuss it?

Mr. Lemass

We could not agree to that. We are giving Government time for another matter which Deputies wish to discuss.

General Mulcahy

I think the Government should take into consideration the fact that a great deal of time was unexpectedly occupied today—time allotted for this motion—in dealing with the Flax Bill. A certain amount of discussion developed on it, but the Bill was passed through all its stages.

Mr. Lemass

I am quite prepared to agree that we do not conclude on the motion this evening and that it should go into Private Members' Time on Wednesday. That would give an extra one-and-a-half hours for discussion. The Government could not decide that unless the other Parties in the House agreed to it because it is not Government time that is being taken. There are Private Deputies' motions which would have priority over it if it was carried over.

General Mulcahy

I think it was agreed that Private Members' Time should be taken on Tuesday next.

Mr. Blowick

So far as this Party is concerned we are prepared to waive our rights in Private Members' Time on Wednesday in favour of this motion.

Mr. Lemass

If that is agreed to, then we can carry on the debate until 10 o'clock and continue it on Tuesday.

Mr. Dillon

I am prepared to give way to-night on the adjournment if the debate is to be continued next week.

An Leas-Cheann Comhairle

Is it understood then that the debate is to go on until 10.30 to-night and is to be continued on Tuesday at 9 o'clock?

Agreed.

Mr. Dillon

I can raise the matter about the Board of Works some other time.

An Leas-Cheann Comhairle

It is understood that Deputy Norton will get some time to reply.

Mr. Dillon

The Minister for Industry and Commerce said that he had received no suggestions. I want to make some which I think would result in a reduction in the cost of living in this country. I speak as one of the few Deputies engaged in distributing goods every day. I am doing that every day of my life standing behind a counter. I know the price of most of the commodities that the people of this country consume—that they have been consuming every day since September, 1939. May I say in passing that it is exasperating to people like me to hear the Minister for Industry and Commerce quibble and say that the price of cotton singlets have increased since 1939 only by 40 per cent. The truth is that brown cotton singlets selling at 3/- in 1939 are now selling at 10/-. That is the marked Government price for them, and the people of the country know that.

Deputy Larkin seems to think that the solution for all this is to peg all prices. The Minister was perfectly right when dealing with that in his reply. The only effect of pegging all prices would be for particular commodities to disappear off the market altogether. The Minister tried that in the case of oatmeal, and within a fortnight you could not get a grain of oatmeal in the country for the simple reason that the people used the oats for another purpose. No miller would buy oats. If he did buy it to convert it into oatmeal he found that the price pegged by the Minister was less than the cost of the oats plus the cost of processing it.

In a very short time there will be neither oatmeal nor flake meal to be had, because the horse breeders are paying more for oats than the present price for oatmeal will permit. Therefore, you will have the position that the horses will eat the oats, and the people will have to go without oatmeal.

What is the truth about the situation in which we find ourselves? The truth is that the Government are now seeing the birds that they let loose coming home to roost. They fooled their supporters into the belief that we could work out in this country a system of economic self-sufficiency that would insulate us against all events passing in the world. That was pure "cod". We are feeling the draught of the inflation which is proceeding in the world, and over which we have no more control than we have over the north wind. All we can do is to set our sails to the best advantage and drift before the storm, praying to God that it will not up-end us half-way across the ocean to the far shore of post-war stability. This House might as well make up its mind that economic self-sufficiency was a "cod" the day it was mentioned in this country; it is a "cod" now, and it will always be a "cod".

Our circumstances are largely dominated and controlled by the price of commodities that we have to bring into this country. If our imports stopped for one month, every soul in this country would be reduced to starvation. If you are not getting in oil, lubricants and fuel, the whole economic structure would collapse and no one but the small farmer, who is able to get a livelihood out of his own land, would survive much more than a month. It is fashionable to blind your eyes to that fact, but it has always been a fact, and it is a fact now.

There is something the Minister for Industry and Commerce can do that he has not done, and will not be persuaded to do yet, which will materially mitigate the severity of the impact of these world events, and that is to announce that he will take off all imports, tariffs, quotas and every other restriction, provided those imports come from within the sterling area, and that he will do his utmost—and he has not an unlimited discretion— to get dollar exchange for desirable imports for any merchants in a position to secure them.

What has he done? He has taken off tariff restrictions until the end of March, which means that one has not got time even to start negotiating. If you go to England now and search round the markets there, trying to pick up a parcel of stuff here and there that you could bring in, you have no guarantee by the time you have the stuff bought that there will not be a prohibitive tariff clapped down on the 31st March. Take the men buying radio parts. They thought they were doing great work bringing in radio parts. In the middle of their operations a prohibitive tariff was imposed and they discovered that half the merchandise they bought and paid for could not be brought in without a 75 per cent. or 100 per cent. tariff.

If the Minister wants to make a real contribution to a reduction of the cost of living, he will announce to-morrow morning that there will be no restrictions good, bad or indifferent on imports for two years. If he does that he will witness very shortly, in regard to a considerable number of commodities, the same miracle that is taking place in regard to cornflour. The Government fixed the price for cornflour at 1/5 per lb., and any intelligent grocer will jump if you offer him 1/-. Why? Because you can buy cornflour freely now and the price is toppling as a result.

The Minister talks of fixing prices; he refers to the cost of material and the cost of processing it, leaving a fair margin of profit, and then you have the fixed price. Fixed price my eye. How can a civil servant, no matter how intelligent he may be, teach men their business who have been in that business all their lives?

There is a fixed price for Indian meal. I sold it for ten years before the war at a profit of 3d. per cwt., and I was glad to get that. I have 1/- on every bag I sell now. The price of Indian meal used to fluctuate before the war. It used to go down to a very low price and then up again, but it had this peculiar characteristic, that whether it was selling for 4/- or 15/- a cwt. your profit was still 3d. If a man went in to buy Indian meal, likely enough he would purchase something else. It was just like sugar in other years. We sold sugar with no profit at all; indeed, some of us lost money on it. The reason we sold it was that whenever a person could buy cheap sugar he bought other goods.

Competition made the shopkeeper keep things down to the lowest penny. When the Government fixes a price, everybody is obliged to charge so much. I am sure the civil servant who fixed a price thought he was doing a great job, paring down the profit of the wicked distributor, who was really putting his finger in his eye all the time. They fixed the price quite honestly for manure and they perused the lists produced by the manure manufacturers. They did not know that none of us ever paid a manure manufacturer the price indicated on the lists. If a traveller asked us for the price indicated on the list, we would simply laugh at him and say: "Go away out of that, yourself and your list. What are you going to sell the super for? All we can get is 3/3d. If you land it at £3 a ton I will take it from you, but if you cannot do that, you can go elsewhere." Of course, they always did land it at that price. But the brilliant civil servant arrived and he was shown all the lists and told how expensive it was to run a mill and how quickly machinery deteriorated. He did his best, but the manure manufacturer's finger was in his eye all the time.

With regard to price control, I wish to God members of the Labour Party would get one idea fixed in their minds. There is only one inspector who works night and day everywhere, and that is competition. There is no other system of price control conceivable to the mind of man that will operate as effectively always and everywhere as competition.

Mr. Davin

What about the black market?

Mr. Dillon

It is because there is no competition in the black market that they are doing so well. If you could get enough chocolate to give the people their requirements, how many hawkers would be on the streets of Dublin to-morrow? You would not see one. There is no other means of getting hawkers off the streets except by giving enough chocolate to the shops and so allow people to buy what they want. You may regulate prices, send out inspectors and take every conceivable precaution, but you will fail, the same as you failed ever since Fianna Fáil came into office. The tariff racketeers have put their fingers in the Government's eye right from the moment they got a wall put up between them and open competition.

The one thing that no distributor, no manufacturer or nobody engaged in trade can escape is the searching finger of competition. Good value, like good wine needs no bush. The average country woman or city woman or anybody else will smell out a bargain in whatever goods she is seeking to buy if it is 100 miles away. You would be surprised to know the distance they will travel in a bus to get a bargain. There is nobody in the distributive trade who does not know that and our business is to keep them off the bus and keep them on our doorsteps. Deputy Larkin states that under the modern capitalistic system, you buy cheap and you sell dear. Nobody but a blooming fool believes that. Do you think that Denis Guiney made his millions by buying cheap and selling dear? He made them buying cheap and selling cheap, and there was never a man yet who built up a big distributive trade who did not do the same. There was never yet a bankrupt who was sold out who did not try to practise the doctrine of buying cheap and selling dear. He is the fellow who always ends up with nothing but job lots in his shop and he loses a damn sight more than his profit in trying to get rid of the job lots.

The Minister issues this challenge to the House: should the Government take over the production and the distribution of essential commodities? I shall answer him. In peace and war, if they are the subject of a monopoly, yes. If flour is the subject of a monopoly, nobody in this country should produce it, handle it or control it except the Government elected by the people. I think a much better system is to let flour come in from wherever it comes cheapest. Let the people buy it wherever it is cheapest.

Mr. Lemass

Does the Deputy know where that is?

Mr. Dillon

We have in this country mills that will produce flour as cheaply as any in the world. Arthur Guinness was not afraid to brew stout on those terms. He not only produced the best and the cheapest stout in the world in Ireland but he was able to sell it in competition the world over. Jacobs' were not afraid to start the manufacture of biscuits on those terms and they sold their biscuits to every country in the world. There is no biscuit manufactured in America or Britain which can compete with their product in this country. If we could get out of our minds the rotten inferiority complex that we are not fit to do anything in this country unless we are spoon-fed, nursed and protected by tariffs, behind which racketeers can rob our people, we would soon discover that, in the lines of manufacture for which our people are suited, we are a match for anybody and that under the stimulation of competition we can serve our community and the world to great advantage. So that my answer to the Minister is this: where a monopoly exists temporarily, then the Government should control temporarily, and where a monopoly is created permanently, then the Government should control permanently, take over the industry and run it by the people for the people. If there is any profit derived out of the sale price of the commodity let it go as a contribution to the Exchequer. If it has to be subsidised, let the loss in selling the commodity to the public be charged to the Central Fund or the Supply Services, but where there is competition in an industry, let the Government keep out of it as far as they can. The further they keep their nose out of it, the less damage they will do.

If it is a question of the price of food or clothes or textiles, let Inspector Competition do the job; he will ensure that the community will get their stuff cheaper and better than any amount of Government surveillance or overlooking can ever achieve. I would prefer to give a manufacturer in this country £10,000 and say to him: "With that subsidy fire away, manufacture your commodity and meet the competition of the world", but I am not going to compel the people of this country to take inferior goods at higher prices in perpetuity in order to give a chance to that manufacturer to rob them. If it is essential to the community that a particular industry should be kept in being, let us know what it is costing us so that every time we pass that manufacturer's door we can say: "There is no country in the world that keeps as expensive a pet as that fellow. He is dearer than the Bronx Zoo." As it is, we let him rob us by stealth. Does 1d. per lb. on sugar mean anything? Suppose every time we pass the door of Comhlucht Siúicre Éireann we could say: "That pet is costing £700,000 per year"? Who keeps that dear poodle except the congest farmers of Ireland?

I agree that, in times of scarcity, rationing is a very valuable contribution to prices control because, in addition to allowing competition to function, you have got to ensure in times of absolute scarcity that everyone gets his share. There is no way of doing that except by rationing. If you are going to have rationing, as I think you must where scarcity exists, it is a matter of the most urgent importance effectively to control the black market. Let us be clear on what the black market means because there is a lot of tripe talked about the black market. There was a period when the Minister for Industry and Commerce facilitated and encouraged people to bring in stuff from Northern Ireland. He never admitted it but I know it was facilitated and encouraged. Now, those people brought in that stuff and paid fancy prices for it and when they got it down here they charged fancy prices for it. I do not think these people were in the black market. I never did, I do not now, and I would never punish them if I caught them. The person I say is in the black market is the shopkeeper down the country or in the city who says to poor people when they come in for their weekly ration: "Oh, the ration did not come this week. I am sorry. You will have to do without your sugar this week". There are certain innocent types of people who in such cases actually go home without their rations and come in the next week. Then he says to them: "I am glad we have it this week". He then hands out a week's ration to a poor woman and says: "There you are now". The woman knows she has been done out of a week's ration but she does not care to be unpleasant about it. That shopkeeper will subsequently sell that sugar to some poor person who wants it for a sick child at 3/- a lb. If I caught that man I would give him three years' penal servitude.

Similarly, if I could find the person responsible for sending into the streets of the city women and girls to sell, in flagrant defiance of the law of this country, sweets and chocolates which have been manifestly derived from an illegal source, I think that no punishment would be too severe for him. It is not that I begrudge these poor women and girls the profit they make, but there is some dirty rogue in the background who is sending out these poor people, teaching them contempt and hatred for the law in order to get his own dirty profit. That confectionery which is being diverted from the ordinary trade channels and is being denied to people who have a legitimate claim to it, is being given to others to corrupt them and use them as agents to rob the public. A beastly shameless black market exists in this way. One cannot help being moved by compassion when one sees poor people struggling and trying to turn an honest penny and to avoid becoming a charge upon the rates or something of the kind. One is naturally reluctant to interfere with them, but I would in that case, not because my indignation was aroused against them but because there is somewhere behind them someone who ought to be found, who ought to be ferreted out, who is making money out of consciously corrupting poor people who fell into temptation because they want to live. That is black marketing, and, where there is a rationing system in operation, where you have to have rationing, it is that kind of person who should be ruthlessy pursued and ruthlessly dealt with when discovered.

Just imagine the Minister for Industry and Commerce getting up in this House and saying that prices have not increased since 1943. That is the kind of glib and specious misrepresentation which makes people who are suffering under acute difficulties despair of having their case heard and reasonably dealt with. Is there any Deputy on any side who will say that prices have not risen since 1943? I seriously doubt if you could name a single commodity the price of which has not risen since 1943.

Mr. Lemass

I named in the Seanad a whole lot of commodities the price of which has fallen.

Mr. Dillon

I searched the Official Report and could not find any reference to them.

Mr. Norton

They are there.

Mr. Lemass

And I could have multiplied the list by ten.

Mr. Dillon

It amazes me to hear what he says. Perhaps Deputy Norton would look up the reference for me. I should like to compare it with my own experience. Some people may imagine that this question of tariffs and restrictions is a matter of King Charles's head with me. The Minister will reply that, so far as tariffs are concerned, he is always prepared to give a licence to import free of duty, and that, so far as quotas are concerned, he is always prepared to extend an individual importer's quota if he is able to get a parcel of goods. That is no good. People will not go out and look for stuff if there is a contingent possibility that, when they buy stuff, they will not be allowed to bring it in, and there is a great deal of stuff to be got if one were free to go and look around for it. It is amazing where one can get galvanised buckets one day and a parcel of boots another day, and it is amazing what the old contacts with merchants in Great Britain and Scotland make it possible for one to pick up from time to time. I am convinced that these things will not be got unless the Minister gives the exemption to which I have referred.

The Minister commented on the small extent to which prices had risen, how effective his price control had been and spoke of his astonishment that prices should have risen so little. I take the case of electric lamps. If one goes out to buy a bulb for an electric fixture, the price is 1/9. The price of that bulb, as advertised in the Saturday Evening Post, manufactured by the General Electric Company of America, is 11 cents, that is, 6½d. We all realise that if you are manufacturing these bulbs for the whole market of the United States of America, with the mass production and mass consumption there, it is possible to manufacture them at a cheaper price than that at which we can hope to manufacture them here in Ireland, and no one would expect a manufacturer manufacturing for the Irish market to compete with the General Electric Company of America; but the difference between 6½d. and 1/9 is very wide. Remember that in respect of this commodity they are protected by a quota. After a certain number of these bulbs have been brought in, no more can be brought in, and, if you want any more, you must buy them from the only boys who have them, and pay your 1/9.

I do not want to waste the time of the House going through the whole list of commodities of that kind, but I should like to tell the House a little experience I had. I wanted to buy galvanised buckets—a very humble commodity. I wanted a licence to bring them in free of duty. Before I could get that licence, I had to satisfy the Department that there was no manufacturer in Ireland in a position to supply me. One manufacturer in this country blocked me at once and said that he could supply them. I applied to him and he said: "Oh, not yet. `Out here', we will supply you". I went back to the Department and said that I did not want buckets "out here", that I wanted buckets now, and right enough I got my licence. A fortnight later the price of buckets went up by 15 per cent. The "colonel" did not want me to get the buckets until he had time to put on the 15 per cent. Now many a person would have lost heart and would have waited for the supply to come from the patriotic domestic source, but, if he had so waited, it would have cost him 15 per cent. on 35/-, and you can work that out for yourself.

With regard to the commodities to which the Minister referred as having been reduced in price, the Minister mentioned tea, soap, candles, gas in Dublin, turf, paraffin, sugar and jam. He goes on to say that sugar has gone up again to 6d. I do not think jam is cheaper.

Mr. Lemass

The price of jam was reduced when the price of sugar was reduced.

Mr. Dillon

I cannot speak of paraffin because I do not handle it. This relates to the period from 1943 to 1946 and the Minister is correct in saying that tea has been reduced by 4d. per lb. Is he sure that soap has been reduced?

Mr. Lemass

Quite sure.

Mr. Dillon

All varieties?

Mr. Lemass

Yes.

Mr. Dillon

I cannot contradict the Minister in regard to these commodities from my personal recollection, but I cannot confirm his statement.

Mr. Lemass

My reference in that part of the speech was only to commodities which were connected with the preparation of the cost-of-living index. There are a number of other commodities which are not taken into account in that connection.

Mr. Dillon

The only ones I handle are tea, soap and candles and I know the Minister is right about tea. As to soap and candles, there are a variety of qualities in these goods and I cannot, from my personal memory, correct him nor can I challenge him—he may be right—but, as regards the cotton singlets——

Mr. Lemass

I cannot certify that the singlets were cotton. The actual figure quoted by the Statistics Branch for singlets in 1939 was 11/3.

Mr. Dillon

Does the Minister imagine that the population in this country were buying cotton singlets in 1939 for 11/3? Deputy Cafferky will tell you what the average customer in Ballaghaderreen would have said if I had asked him for 11/3 in 1939.

Mr. Lemass

That was the average national price of all singlets.

Mr. Dillon

All I know is that if I had asked that price I would have got my windows broken. But I would not get them broken now. The average price of a cotton singlet before the war was approximately 2/6.

We are now pretty well on in an inflation which we cannot control. We are making matters worse for ourselves in our idiotic attempt to maintain around us a high wall of tariff protection and quotas while the tornado is raging around us. That should go, and go at once. In the case of monopoly products, such monopolies should be operated by the Government for the benefit of the community. I think there is a good deal to be said for the view expressed by Deputy Larkin— which he has borrowed from the Labour Court—and that is that in regard to the lower rate of wages a flat increase of 60 per cent. over 1939 and in regard to the higher rate of wages a flat increase of 40 to 50 per cent., in accordance with the scale laid down by the Labour Court for the Electricity Supply Board, is a reasonable adjustment of wage rates at the present time. Speaking from my own experience in the distributive trade—and I am a pretty small unit—I think it could be done without placing an unreasonable burden upon anybody. It does, I admit, place a substantial burden but not an unreasonable burden on those who will have to pay it. I think it goes fairly far along the road to meeting the hardships that the persons with modest incomes have had to bear and are now bearing. I think it would go as far as any general rule could go, but leaving, at the same time, those who can pay more free to do so, if their conscience so dictates.

I ask the Government, however, to remember this: there are two problems for two classes of the community which the adjustment referred to in regard to the Electricity Supply Board award does not meet. I speak of the whitecollar person. It is no use saying that because a person was earning £300 a year before war broke out that he is now well off. If you have your children at school and if you are living in a six- or seven-roomed house and have certain fixed charges, which are right and proper for the income you are earning, it is idle and ridiculous to say that all these should be shed and that, in order to help the common cause, you should step down out of the grade of life into which your skill and industry and exertions have promoted you. There is no doubt that people like university lecturers and civil servants, the employees of many corporations, like the Agricultural Credit Corporation, and what I shall term quasi-civil servants—but notably university lecturers—and people of that kind are to-day in dire distress. I know men who are going steadily into debt. I know that these men are not buying one solitary stitch of clothing for themselves. I know that they are trying to keep their wives and children in that degree of comfort and appearance which will avoid embarrassment to them before their neighbours. Their case ought to be made because they are the very best of material we have in this country.

I warn this House that at the present moment in Great Britain there is developing a vacuum for man power. If it should happen that they turn to this country in their effort to fill that vacuum they will suck out of it overnight, at almost any price, the best brains and the best men and women we have got. Those men and women will get in Great Britain more than we can afford to pay them no matter how hard we try. But we have a reasonable hope that if we can, as far as is possible within the rules of justice, meet their legitimate demands a sufficient percentage will prefer to remain in this country in modest comfort rather than to accept a comparatively plutocratic luxury in Great Britain.

There is one other section to which I must refer. I am not suggesting now that the Government are cold, hard-hearted villains in this matter or that I refuse to recognise their difficulties. I admit there is a difficulty. I am dealing now with that class of person for whom I have so often heard Deputy Alfred Byrne raise his voice in this House— that is, the very poor, the old age pensioner, the widow and the orphan and the Civic Guard's widow who is in receipt of a pension of £60 a year. Such people are literally starving. I know that one can over-paint that picture. I know, too, that it is nonsense to pretend that the average old age pensioner in this country is living on 10/- a week. If he were depending on that he would be dead long ago and it would be a scandal and a disgrace if his own children did not rally around and help him and the curse of God would fall upon them if they did not do it. The 10/- is given to help them to procure for themselves those little luxuries which they could not otherwise get from their children. These are people whom we all know are a perfectly legitimate charge on the incomes of the rest of us. Their plight at the moment has become almost unbearable.

They are a strangely inarticulate and inoffensive group of people. If they try to bind themselves together to get something done it is usually at the instance of some loud-mouthed and unscrupulous exploiter who wants to collect their miserable shillings and bawl off the top of a barrel and, in doing so, grossly misstate their case, misrepresent them, and lead them into extravagant demonstrations which command neither the sympathy nor the support of their fellow citizens. We all admit there is a serious problem there. I admit that the Government has not forgotten it and has made, through a variety of devious devices such as grants of free potatoes and extra milk and another half-crown to the pension, some effort to meet the situation. But there are categories of people who are forgotten and who are suffering most severely, notably those I have mentioned. I draw particular attention to two who are peculiarly voiceless, namely, the Civic Guard's widow and the lecturer. If the Government would look into their case they would find how severe is the position. The wretched pensions deprive them of the right to a contributory pension. No contribution is made in a Civic Guard's pay to national health insurance. The result is that the unfortunate widows are not entitled to a contributory pension and the £60 a year of which they are in receipt deprives them of the right to a contributory pension. They are expected to eke out their existence as best they can on that and I myself know unfortunate women whose circumstances have forced them to go out to earn a living and to distribute their children in schools or amongst relatives.

The others then—and I make a most especial appeal for these—are the university lecturers. They are not vocal. They do not like publicising their difficulties and their distress but God knows how grievous is the problem created for them by this inflation storm, which we cannot stop but which we can to some extent do our best to ride so that the least possible damage will ensue to that community for which we are responsible.

The difficulties are great. Let us realise what they are and face them courageously. Let us examine and find out the things we can do and give up fooling ourselves about those things we cannot do. We cannot stop inflation. It must come. It is going to come. Any man who puts his money in a stocking now is a damn fool. He should buy good property—bricks and mortar and the equities of good companies. In ten years' time, that money will be worth ten times what it is worth to-day. If that were not so, then Great Britain would never pay her national debt and neither would America. These two nations, if they survive, will reduce their debts to a figure which conceivably they will be able to liquidate. Money is on the way down. Inflation is on the way up. Let us all pray that the powers of the world will be able to control it. If they do not control it, we will be involved in the catastrophe which will follow. But I believe they will control it, even though they may not control it at its present level.

It will probably go higher, perhaps not much higher, but it is not going to come down much. We ought to face that and realise it and do the best we can to control it. We can do a great deal. I trust that part of the Minister's memorandum which was reserved for suggestions is no longer sterile. I have made three, none of which he very much likes because they all reflect upon the darlings of his heart, the tariff racketeers and monopolists of this country. Nevertheless, if he is an honest man meeting the crisis that confronts this country at the present time, he will adopt them all and, if he does, he will have done a great deal of what any man could do to meet the problem we have to deal with.

Mr. Cogan

There is a motion and an amendment before the House and I want to state bluntly and frankly what I intend to do with regard to them. Under no circumstances can I support the motion. While I have every sympathy with the case made by the mover and seconder of the motion I think, if adopted, it would brand this House as a futile assembly, with no sense of justice. The great Edmund Burke once said that you cannot frame an indictment against a nation. It is equally true that you cannot frame an indictment against a class. The motion seeks to put the manufacturer and the distributor in the dock and to charge them with criminal profiteering. With Deputy Dillon, I maintain that in a free society, where people are not controlled, regimented and enslaved as they are in a totalitarian State, competition is the best and most effective means of preventing profiteering.

What has prevented competition from having its effect during the past six or seven years has been mainly a shortage of supplies of all commodities which the community require. There has been a considerable quantity of goods on the market but not altogether sufficient for the requirements of the community and there has never been a surplus with which an enterprising businessman could attack the standard of prices and seek to reduce them. It would not have been possible for Denis Guiney, whose name was mentioned in this House, to have established a huge business providing clothing for the poor people of Dublin at a low price if there were not ample supplies of clothing within reach and available. Until there are ample supplies of goods and commodities available, it will not be possible to bring competition into operation and make it effective.

I do not entirely agree with Deputy Dillon that we are completely helpless until supplies become plentiful or that we have no possible means of control over the situation which is developing. The situation which is developing is alarming and is causing very grave uneasiness. We have developing in the country a vicious spiral in which wages and prices chase each other upwards and upwards and at the same time, as Deputy Dillon points out, we have a large and ever-increasing section of the community crushed into a condition of poverty and destitution as a result of inflation.

The amendment before the House, in my opinion, is a sensible one. In all humility I say that I do not think it could have been improved if I had drafted it. It does not specify any definite means by which the problem can be solved but it does ask for a serious attempt to face the problem and to solve it. It suggests that there should be a thorough investigation of all possible means at our disposal, if not to solve the problem, at least to mitigate its effects.

The Minister started out by saying that he had a virgin page in his notebook upon which to take suggestions. That reminded me of a menu card which I noticed once in one of the big restaurants in this city. On that there was a space marked "comments" and a space marked "suggestions." In the space for "comments" was stated: "Meat raw, cabbage cold" and in the space for suggestions was stated: "Sack the cook." I shall not put forward so drastic a suggestion as that, because at the moment there is not much prospect of being able to shake off the cook and it would not be a workable suggestion. A time may come when the cook will be sacked but in the meantime there is one practical suggestion which I will make and which, if there were more time at my disposal, I should like to develop. In this city and practically throughout the country there is nothing which is causing greater hardship at the present time to a very large section of the community than the shortage of domestic fuel, the unsatisfactory nature, and the high price of fuel. There is nothing which contributes so much to the high cost of living, particularly for the poorer sections of the community, as the enormous price they have to pay for domestic fuel of every kind and the unsatisfactory nature of that fuel. If an attempt is to be made to reduce the cost of living it ought to be in a determined and resolute drive to provide cheaper and better fuel for our working-class people, particularly in the cities and towns. There have been certain imports of coal into this country which were not diverted to any extent to the ordinary domestic user. There ought to be a determined drive to obtain firewood to tide our people over the next few difficult months, until turf is available. I move the adjournment of the debate.

Debate adjourned.

The Dáil adjourned at 10.30 p.m. until 3 p.m. on Tuesday, 28th January, 1947.