Vol. 106 No. 12
Tairgim:
Go ndeonfar suim nach mó ná £820,760 chun slánuithe na suime is gá chun íoctha an Mhuirir a thiocfas chun bheith iníoctha i rith na bliana dar críoch an 31ú lá de Mhárta, 1948, chun Tuarastal agus Costas Oifig na gCoimisinéirí Ioncaim, lena n-áirítear Seirbhísí áirithe eile atá faoi riaradh na hOifige sin.
The same remark applies to this Vote as to the previous Vote. The principal increase is due to the increased cost of the Civil Service during the year.
I understand that a number of commodities are imported into this country the export of which from Great Britain and Northern Ireland is prohibited. They are nevertheless imported and our revenue authorities give their co-operation and support to those engaged in that import. That is a bad policy and makes for evasion of the tariff regulations, particularly on the Border. The Border, as everyone will agree, is a curse from every conceivable angle and the sooner it is abolished the better, but, so long as it is there, the administration of the customs services on both sides will be facilitated by a certain measure of co-operation. So long as you have the officials of the Northern Ireland Govenrment assisting smugglers to outwit the officials of our Government, and the officials of our Government assisting smugglers to outwit the officials of the Northern Ireland Government, there can be no possible hope of dealing with smuggling operations along the Border. It is a problem which ought to be tackled and tackled very vigorously. If, as I understand, smuggling is very widespread along the entire length of the Border, it is bad from every point of view. It may be that as a result of certain smuggling operations we may get into this country certain essentials which are necessary. But I think everyone will admit that smuggling is not a one-way traffic; that there is nobody smuggling commodities into this country who will not at the same time be engaged one way or another in smuggling certain essential goods out of the country. Therefore I think that if you close your eyes to one type of smuggling operations, you are closing your eyes to a great extent to all these illegal operations, and I think the time has come, now that the war is over, for more rigid enforcement of the law in regard to the prohibition and the regulation of the transport of goods across the Border.
I think it is acknowledged that there have been very wide evasions of the customs regulations and I think there has been a very considerable failure on the part of the Minister's officials to enforce these regulations. There have been even, I think, grave breaches of the law by officials of the Minister's Department. I should like when the Minister is replying if he would let us know whether during the past year officials of his Department have had to be dealt with in a disciplinary way for breaches of the customs regulations. I think it is a very important matter. It affects not only the collection of duties and the prevention of illegal exports, but it also affects the morale of our people. If smuggling on a widespread scale is allowed to continue it must inevitably have a very demoralising effect upon the entire community on both sides of the Border. In addition to that, it will be creating a very strong financial vested interest in the preservation of the Border.
The Minister in his Budget statement mentioned that he did not fear a very serious illegal export of tobacco and cigarettes out of this part of the country as a result of the differentiation in the price here and the price in Northern Ireland. I should like to know from the Minister what steps he has taken to prevent such illegal operations. I think it is a very important matter to have the law rigidly enforced in this connection, but I think it will be a very difficult matter so far as commodities like cigarettes are concerned where there is a big profit to be gained by illegal operations, and I should like to know if the Minister has taken any special steps to ensure that the law will be enforced.
I want again to refer to this matter of salaries. According to this, the increase is £113,000 on a bill of over £1,000,000, that is about one-tenth. I assume there were increases before. The Minister tells me that the last increase given amounted to 25 per cent. In any event, I want to get this clear. There has been an increase in the numbers employed. There are some 60 extra shown over last year. It would appear that in 1938 or 1939 the salaries, wages and allowances were roughly about £800,000. The sum is now to be £1,157,000. That sum has a purchasing power of about £580,000. The 2,500 civil servants employed in this Department have suffered a loss in purchasing power of the difference between £580,000 and £800,000, somewhere about £200,000. There is no getting away from that. There may be an argument as to whether we can afford to pay or not, but, in any event, that is the loss.
This is a group of 2,500 officials who were brought into the Civil Service on a contractual arrangement that they were to be preserved from the severity of any slump and were not to enjoy any boom. Their salaries were to be smoothed out; they were to have an equitable course. The secretary of the Department of Finance on one occasion boasted that the contribution of civil servants to the State under the cost-of-living bonus amounted over a certain number of years to £3,000,000. That is all very well. We took £3,000,000 from them when the cost-of-living figure went down and we saved that to the State. But when the cost-of-living figure began to go up, those who had been promised safeguarding from the severity of any slump were simply told that the contract was going to be broken, and broken it was. For fear anybody would go to the courts to test that, we fortified that by legislation, by the type of legislation which could not be attacked upon Constitutional grounds. They were attacked just because, as I said, they lay nearest to the hand of the Government. They were under the thumb and the control of those who were running the Government at the time. They were simply told without any case being made in respect of these people, and certainly without any consideration of the advantages that previously had been derived by the State from the cost-of-living figure, that it had been decided that they were going to stop salaries being paid on foot of that figure. There were some negotiations and the civil servants, apparently, have accepted some increase. But the situation is clear that, without any argument being made, except that one made in the House about inflation, civil servants were told that they were not going to be allowed to get the benefits when they accrued to them from the contract, but they were made suffer when it was disadvantageous to them.
In the Estimate for 1947-48 we are apparently to mulct them for the year in about £200,000. I have compared that over and over again with the attitude of the Government not merely towards those who made profits and were told they could make profits, and those who were invited to make profits because they became tax collectors for the Government, but towards those whom the Minister's predecessor characterised as people who were making money out of the exigencies of the war situation, people whom he said he would use his best endeavours to stop. When challenged in the Seanad as to whether he believed these people had made millions, he said he knew from the revenue accounts that they had made millions. The case is therefore clear on both sides, that civil servants are being defeated in their just claims and other people were allowed to get away with the increased profits that the Government invited them to take. That calculation leaves out altogether the matter of evasion. I mention all that because the Minister says when I make this type of speech that I do not appreciate the difficulty of finding money. It is difficult to find money ordinarily. But our Minister, who has thrown away the full amount of the excess corporation profits tax, should certainly have no difficulty in finding the odd part of £1,000,000 which is now required to give civil servants what they were entitled to.
There is the other calculation which I have made before and which I want to repeat. If one takes the six or seven years in which profits were made during the war, there was a vast fund of money piled up as earnings by people in business. On the other hand, there was a very big withdrawal from people like civil servants, from the wage earners of the community, from professional men, and from middle-class people, of moneys to which they were justly entitled. I think the people from whom the withdrawals were made could properly and justly claim that they should be given part of the moneys back and these should be scooped out of the fund. These other people have advertised themselves as having made so much, but I will leave that question aside. Cut the losses and leave the gains, in so far as they have been made in the war years, with the people to whom they were allowed and who got away with so much. Let us recognise that there is hardship imposed on certain people, and that there has been an undeserved gain allowed to certain others. Put them in a position of equality.
I think it was unfair of Deputy Cogan to make a general allegation against the officers of the Revenue Commissioners. I think those officers are doing a good job. They have, over the years, saved our people from the wholesale export of commodities that were in short supply here and they have enforced the law against those who sought to import illegally things that were subject to customs duty here. If the Deputy has any particular matter in mind, or any information to give me, I am quite prepared to hear it, but I am not prepared to go into a general allegation that runs counter to my general knowledge of the matter. These officers, rather than trying to facilitate smuggling into or out of the country, are doing their utmost to stop it. In the year ended 31st March, 1945, upwards of 11,000 cases of smuggling (mainly export) were prevented by them and successful prosecutions followed in 654 cases.
With regard to Deputy McGilligan's misstatements, we have gone over that ground frequently. I pointed out that during this particular year we made reasonable increases in the salaries of the civil servants, which brought them to a minimum of 25 per cent. over pre-war. I do not propose to go into all the arguments Deputy McGilligan put forward as to where we should find the money to repay the civil servants what they lost under the standstill Order. It happens in life that changes occur, that certain sections of the community suffer for a while and then other sections of the community suffer for a while. People in the course of business suffered during the slump that occurred after 1929 and at various other times.
Deputy McGilligan pointed out that some of the concerns that had been making profit during the war were suffering losses prior to the war. No matter who they are—whether they are farmers, shopkeepers, lawyers, doctors or anybody else—people will not continue making losses. They are all engaged in their professions or occupations in order to make a livelihood and to keep themselves and their families. While I would like to stop a person making excessive profits, I do not want to stop anybody making a reasonable profit, one commensurate with the sacrifice he makes to keep the business going or to fulfil his daily obligations.
I do not know what misstatements I am supposed to have made. I allow for 25 per cent. I take £1,000,000 in the column headed 1946-47 and I calculate that as being £800,000. A 25 per cent. increase would bring it roughly to the £1,000,000 that is here. I compare £578,000, which I say is the present purchasing power of £1,176,000, with the £800,000 that I assume these people were getting in the year 1938-39. It is then recognised, because there has been no attempt made to meet what I say, that 2,500 civil servants have suffered between them—the years have passed and they should have been getting increased emoluments—a loss of somewhere about £220,000. I consider that is unfair.
I have heard only one argument put up about the standstill Order on the civil servants, and that referred to inflation. Questions were put here to find out what did the standstill Order mean, and the answer was given that it meant roughly £1,000,000 a year. The civil servants, people in a special position, people with whom we had a very definite contract, a contract that we had used against them when the cost of living was falling, had to suffer. The situation with regard to them was that if they got £1,000,000 extra there would be inflation. That argument went by the board when it was discovered that remittances from England ran to £13,000,000 in a particular year and tourists brought in £10,000,000. Yet, in a year in which, from outside sources, £23,000,000 was being sent in here to be spent if the recipients decided to spend it, the civil servants were forced to take for themselves, and for the education of their families, whatever funds they had in the way of life insurance and anything else of that sort—they were forced to take out of these funds the £1,000,000 a year that they had lost.
The pretence that if £1,000,000 was given to the civil servants it would cause inflation was paraded by a Government which admitted an inflow of £23,000,000 which they did not believe was causing any inflation. I tried to bring the matter to a head one day by asking if the civil servants could be paid by means of the tourist money, which was somewhere insulated against causing inflation. On the Minister's part there was first the denial that business people and industrialists were making money. Then the Minister's predecessor gave that game away and we were given to understand that they had made millions. He even proceeded by way of legislation to take some of what these people were making, but he made some distinction between the people who were getting increased profits. As long as certain people were getting only the same rate of profit he apparently thought that was all right and he excluded them and then he put in a special clause with regard to those making extra and extortionate profits out of the exigencies of the war.
The Minister has apparently a new excuse now. Some people were making losses prior to the war and the Minister put forward the point that if a man had made a loss for a considerable period he might go out of business. Remember all these people were not making losses. Arnott's made a loss of £1,500, but if their business in 1939 showed a loss of £1,500, is it necessary in order to keep Arnott's in business that they should make £23,000 later? They declared no dividend in 1939 but later they were able to declare a dividend of 27 per cent. Crowe Wilson's had not made a loss; they had made a profit of £7,000. Again, is it necessary to allow them, after tax had been deducted from their profits, to get to the point of making £15,750? Todd Burns, who suffered a bit of a loss—it was not exactly £1,000 —got to the point of making a profit of £18,000 later.
The Minister is very benevolent towards business people as he thinks they might go out of business. They are very lucky to have something to go out of. What can the civil servant go out of? What can the wage-earner go out of? He goes out of this: he goes out of the payment of premiums on insurance; he takes his children out of the type of education he had thought of giving them. He possibly takes, as I know happened in a certain case, furniture out of certain of his rooms and deprives himself of certain amenities. While the going was good, he sold this furniture, sold some second-hand carpets in order to keep going. The only other thing such a man could go out of was the ordinary comforts of life, even the necessities of life.
I made a calculation recently arising out of what the Director of Statistics had pointed out in connection with the last census of production. He said that the earnings in wages and salaries of the working classes, apart from those engaged in agriculture, amounted to £25,000,000. Let us take it that that was the pre-war wage. He was speaking of a date not exactly pre-war but pretty close to it. I do not think there can be any gainsaying the fact that the £ now buys only 10/- worth as compared with pre-war. That meant that these people instead of having a purchasing power of £25,000,000 have only half of that. To counterbalance that reduction in their purchasing power, they got increases in salaries and wages of between one-fourth and one-third. That does not bring them up to anything like the old £25,000,000 purchasing power. The Minister said that Arnott and Co., Pim Bros. and Todd Burns might have had to go out of business. What do we do to keep them in business? The Government's attitude was: "We will allow you to keep 50 per cent. of anything you make above a certain figure. Pay us half of it and you can keep the other 50 per cent."
I want to stress this to the Minister, that after that tax has been paid, the firm of Todd Burns which had suffered a loss of £1,000 in 1939, were enabled to make such profits that after making provision for whatever increases or bonuses they granted to their staffs and for increased rates, they were able to pay the taxation the Minister imposed on them and had then £18,000 to put away. I consider that there is no line of equity as between the treatment of the professional class, the middle-class and civil servants on the one hand and this 10 per cent. of the community who have been allowed to get away with enormous profits during the war period. I am leaving the question of evasion aside and there has been evasion. Evasion is calculated at not less than 25 per cent. of the admitted profits. Leaving that out of it, the position is that they have been able to make very big sums of money. The Minister says that he would like to do better for the civil servants but that he has no fund out of which he could afford to do better. He has plenty of funds if he looked for them in the proper quarter.
