You have not read it, but let us hear about the debts. The debts were the schemes that are now going to be financed this year in the Book of Estimates. We covered our current expenditure by ordinary means. It was met out of ordinary revenue. Our capital projects have now been accepted by Fianna Fáil. Even though they have accepted them, I doubt their sincerity, but they are accepted and they are doing that rather than cause public commotion. All our capital schemes are in the Book of Estimates, some reduced in value. But they are accepted as proper for borrowing, so that that argument is gone for ever.
As regards any money we got we had two objectives. One was to raise the standard of living in this country and particularly to raise the standard and volume of our exports. We succeeded in that. The second thing was, that we so financed things that the national income increased in such a way that the yield from old-time taxes brought in so much more money that out of the surplus you could finance and pay the cost of the money that we had invested in the country. That has been an actuality as I will show later by the figures. We provided the cost of borrowing without having to increase taxes. In the main we reduced taxes with the people here getting a bigger yield because the country was progressing.
I am told about the deficit that is supposed to have been left by me last year, and about things that were not mine. As regards this so-called deficit, there is the £3,000,000 on the turf produced. I say that turf losses are to be considered as something apart although they are in the deficit. I have asked the Minister about the sum of £2,000,000 that I left him as a carry-over from the previous year. I have not got any answer to that. We have the Exchequer returns in this morning's newspapers. They are made up to the 17th of this month. The revenue is given at £12,346,000. For the corresponding period of last year the return from revenue was £12,136,000. Therefore the revenue is a couple of hundred thousand pounds better, but that is not the point. In the figure of £12,136,000 there had been siphoned away £2,000,000 of a carry-over. It is either there again in this year's revenue, and I believe it is, or if it is not, there is the more interesting situation facing the Minister that his revenue has increased by £2,000,000 over last year in the period between the 1st April and the 17th May—call it six weeks. Either he has that £2,000,000 of a carry-over, or else the revenue is showing the buoyancy that we always said it would show if there was not this defeatist spirit in the country.
I have said that the aim of this Budget is clear. The Budget itself can only be explained or recognised from the background and the philosophy of it. The people are to be pledged to these impositions, and they are asked: do you think we would be so sadistic as to impose these taxes if they were not required or that we would risk our popularity in doing so? They had become obsessed with one idea—the gap in the balance of payments. One may accept that there is a gap in the balance of payments; that it is going to continue; that it will bring about bankruptcy and insolvency, and that something must be done about it. That is the view the present Government has adopted, and it is on those lines that the present Budget has been prepared.
There are two types of inflation that can be thought of in this connection and that were mentioned last year. There is the inflation that is spoken of when an increase in prices is caused by too much spending chasing too few goods. We had not got that in this country. The only inflation we had got was an inflation of a price type. It was an import inflation, necessarily imported here because of our junction with the currency position in Britain. The other type of inflation which we had in some degree was the inflation that was caused by the blowing up in the form of our imports. Some people may have got terrified of that. The present Government did, but we did not. We thought of it as an abnormal circumstance which was wearing out, and we felt that it would right itself. We felt that efforts were being made in this country both to prevent inflation and to weaken inflation. Let us say that we had inflation of the type that is shown by our imports being very heavy—far more than we are paying for by our exports. The problem was to get rid of that situation, and to get rid of it without turning over to inflation of a price type. The problem could be immediately faced by having a physical control of the ports and the Border, thereby stopping imports coming in. In that way, imports could be reduced and the balance of payments rectified. If that were the case then all the money that was in the country partly expended on the goods that are imported would be focussed on the small quantity of goods that would be produced here. In those circumstances we would have swung over from the inflation of the import type to the fierce inflation of the price type. There is only one answer to that, we cannot stop imports by physical control. Otherwise you would have prices inflated. What you can do is to leave people without the wherewithal to buy goods and thus have the whole situation rectified. Look at the measures that were suggested by the Central Bank and, in the main, adopted by the Government.
The Central Bank suggested that bank credit should be restricted and that businesses and private enterprises should not be given the finance that would be required before they begin to earn a little money in order to establish new projects. The difficulty is that, while the factory is being built and machinery installed, the workers are getting wages. While workers are getting wages they will spend them, thus calling for more imports and creating a gap in the balance of payments. Similarly, State schemes could be restricted. However, the difficulty is that wages will be pouring out before the schemes are finished, and the workers will spend their wages. The only thing to do is to restrict schemes so that there will be no money and, in such a way, reduce purchasing power generally. The best solution will be to lift £10,000,000, £12,000,000 or £14,000,000 from the people by pretending that you are looking for a balance for your ordinary revenue account, whereas, in reality, you are looking for a surplus—the surplus that was left behind by me, and the surplus that is put across by the present Minister for Finance, who has accepted this terrifying aspect of the balance of payments.
I asked the Minister for Finance to-day could he inform us with regard to this £3,000,000 which he says he has to get to provide for the Social Welfare (Insurance) Bill, 1951. I asked him could he divide the £2,000,000 amongst the different types of benefits to be given. We wanted to get the proper amount phrased. The amount can only be partially phrased. The Government are making £3,818,000 over and above the compensatory welfare benefits according to their own figures, which we do not accept; £918,000 of this £3,818,000 is sheer profit from the subsidies. Of the other £3,000,000, £1,000,000 is proposed to go to certain undisclosed schemes added to the Social Welfare (Insurance) Bill, but there is a sum of £2,000,000 to be given towards sickness, unemployment and old age.
I am told that these are the main causes of expense under social insurance. I want to get those figures. I want them to be divided under special headings, and I want to get the picture clear that the bread and flour tax will pay for, say, unemployment and that the butter tax will pay for sickness. The other taxes, between them, will pay for old age pensions. After that is provided for there is £1,000,000 over for undisclosed benefits. Also taken out of these taxes and over and above that the Government have £918,000 sheer profit on the subsidies. That is what Deputies are voting for. Deputies are trying to put across the people of this country a Social Insurance Bill, but they are not saying to the people: "We are getting it back on the food. We are taking a bit off the loaf and something off the spread. We are giving you less sugar in your tea and we are making you drink less and smoke less. That is the way in which we are going to provide you with this scheme of insurance proposals."
Apart from that there is the beer, the tobacco and the spirits tax— £3,800,000. The Government's idea is that they are going to get that money. Between that and their net gain on the subsidies there is a sum of £12,750,000, and where is that going to come from. Do not let anybody, as I said before, think that these taxes on beer, spirits and tobacco are intended to get people off drinking or smoking. If they do that, to any great extent, the Budget is burst. The truth is that it is hoped that people will still drink and smoke as they did before, because that £12,000,000 has to be found somewhere. £8,800,000 has be found somewhere. The housewife is going to be forced to save something out of the worker's pay packet; she will have to economise on the children's food, education or clothes; she will have to make rigid economies in the matter of domestic appliances. That £12,750,000 has got to be found by means of the extra cost of food and by other economies which the housewife will be forced to make in order that her husband can smoke and drink nearly as much as before and, in addition, pay more for them.
I am amused when I hear questions put down by Deputies as to the number of unemployed in the country at the moment, and asking by how much the number has gone up since a special date. We are told that the number is 12,000 more than it was this time last year. The Minister says the same is happening in England, and that they have a big rearmament programme. The Minister should say: "If we have not another 24,000 unemployed before the end of the year, the Budget needs unemployment, short time and a bit of emigration. The Budget hopes for a business depression. There are businesses at the moment that are not making the wages they are paying to the employees. However, they are keeping on the employees in the hope there will be an improvement in the situation. The Budget requires unemployment and depression in business, because that is the only way in which they can prevent people buying at the rate at which they have been buying before and causing this terrifying gap in the balance of payments.
On the other side the British Budget was criticised on the grounds that it was an attempt, as the phrase was used, to purge out the national economy by deflation, bankruptcy and unemployment. That is the phrase used in the British Commons, "purging out the national economy by deflation, unemployment and bankruptcy" yet the Budget there was nothing like as harsh as the Budget here. One of the last books on monetary matters that has been produced, a book called International Economic Co-operation, written by a man called Tew, says in the earlier pages: “Even a mild local depression in itself is an appreciable corrective to any cash outflow”—that is a gap in the balance of payments—“because unemployed workers or impoverished businessmen are poor customers.” Of course, that is what we want here under this Budget scheme. We want poor customers and if there is a business slump, in its early stages called a recession, and if there is unemployment and if there are people on short time they will have no money to play around with and they will not cause any strain and we will get our economy purged out in this way.
I said recently that anybody who caught the mood in which this present Budget had been framed realises that the remedial measures are simple. They have been calculated by the Central Bank and checked by all other bankers in the country. The remedial measures are simple but they are savage in their severity. It is deplorable that this savagery should be tried in this country at a time when it is completely unnecessary.
Then we have the contrast of the dance hall proprietors. The dance hall proprietors are going to get this £140,000 on the grounds that it was a bad tax to collect. It cost an awful lot to collect and the revenue officials who had the odious job of collecting it were subjected to a certain amount of abuse and had to interrupt the enjoyment. It also was a very bad tax because it encouraged people to be rogues. They did not declare the true return, as if every income-tax payer did. In addition to that we were told it was a failure and the final plea was made that the poor proprietors could hardly live.
All these excuses were to hide the fact that Miss Kathleen Morris, the secretary of the Irish Ballroom Proprietors' Association, wrote a letter to which she attached a letter from Mr. Seán Lemass of 10th May, 1951. Having referred to this letter she went on to say:—
"Following the receipt of this reply from Mr. Lemass, a further executive meeting was held to-day, the 15th instant, when the meeting confirmed their pledge of support to Fianna Fáil. It will be appreciated"
—this is ironic—
"that the association is entirely nonpolitical, and that having failed utterly to impress the previous Government or Minister for Finance, though it pointed out the hardships——"
—It was at this point that the handkerchiefs were taken out—
"caused to the ballroom business, to clubs hiring the ballrooms, musicians, staffs, etc., the association has no alternative but to support the Party who has indicated that they are prepared to repeal this tax as soon as it is practicable.
The association has decided that the support to Fianna Fáil should take the form of substantial financial help and also that all members both city and country should lend a hand in every possible direction to secure the return to power of the one Party who has given the association an indication that they, as a Party, are opposed to this undesirable entertainment tax on dances.
It will be appreciated that in order to have the desired effect our financial aid must of necessity be generous. I may mention that one leading commercial ballroom in Dublin has headed the list of subscribers to this fund, with the generous sum of £250, and other members of the executive have also indicated their willingness to subscribe very generously."
That is the reason why the dance tax was removed and not any nonsense about a philosophy on entertainment. These people supported Fianna Fáil. I do not know what the subscription amounted to but £250 was not a bad start off if it was not a decoy. However, I understand the fund did amount to a respectable sum. So, in this year of austerity £140,000 is remitted to the dance hall proprietors.
Let me briefly deal with the so-called objection in regard to the cost of collection of the tax. I was informed and it was stated in this House that the cost of collection did not amount to 2 per cent. and that bore favourable comparison with the collection expenses of other taxes that are still being imposed. With regard to the question of abuse to which the revenue officials were subjected, when I made certain remissions which excluded the operation of the tax in certain areas the revenue officials were quite happy about the matter. With regard to the tax failing so far as the amount returned was concerned, far from that being the case, the amount in the early stages was £100,000. Last year it was £120,000. This year it is £140,000. The tax was yielding everything that was expected of it and it was easy to collect. When I met the dance hall proprietors—it was one of the last meetings I had before the last Budget I introduced—they wept about their own private fortunes. I suggested that there was an answer for them. If they would let me consult the Revenue Commissioners, perhaps the matter could be settled. The returns of the group in which the dance hall proprietors were included showed a remarkable buoyancy during the last two or three years. The dance hall proprietors then made the point that it might be the people running cinemas and other entertainments. I told them there was an easy way out of that because we could get, with their leave, but only with their leave, the returns of the dance hall proprietors segregated. After a very short huddled conversation they decided it would not be possible to go into that. That is the situation about the dance tax. It was a good tax. It was easy to collect and when it is now remitted it is not going to mean cheaper dances. It is going to mean more profits to the proprietors and that is the clear intention of such remission. As I said before it is an open scandal, it smells badly and nobody wants to be associated with it except those who are going to be driven into the Lobbies to support it.