asked the Minister for Finance if he will state the net liability of the Exchequer in respect of the Marshall Aid Loan and interest thereon over the full term provided for repayment and allowing for prospective income earned by assets of Marshall Aid Loan Counterpart of £41,397,268 as set out in Account XXV of the Finance Accounts for the financial year 1952-53.
Ceisteanna—Questions. Oral Answers. - Marshall Aid Liability.
The gross liability of the Exchequer, at the present rate of exchange, on foot of Marshall Aid Loan proceeds of £40.7 million is £45.8 million in respect of principal and £25.8 million in respect of interest for the full term of the loan, i.e., to 1983.
The Deputy was informed in reply to his question of the 22nd October, 1953, that the assets of the American Loan Counterpart Fund, to which the loan proceeds were transferred, consist as to £630,000 of Agricultural Credit Corporation Stock and as to £40.5 million of Ways and Means Advances to the Exchequer. These advances, with other Exchequer borrowings, were utilised to finance capital and other services during the period from December, 1949, to December, 1951. The particular services financed by these Ways and Means Advances were not segregated and it is not, therefore, possible to say whatare the actual or prospective receipts of the Exchequer from the expenditure of £40.5 million. What is certain is that the interest and principal repayments on the loan as they fall due must be discharged in U.S. dollars and that these dollars must be bought at the ruling rate of exchange with funds provided by the Exchequer out of current revenue. In so far as the income and principal repayments derived by the Exchequer from the assets created by the expenditure of the £40.5 million—as supplemented by the receipts from the investment in Agricultural Credit Corporation Stock —are insufficient to meet the loan charges, the deficiency must be made good from taxation. The prospective deficiency in the assets available in the fund for repayment of the principal of the loan will also have to be made good from the same source.
Will the Minister say, when he describes the charge coming in course of payment as having been redeemed out of current revenue, does he include in the description of revenue the heading Sundry Receipts of £3,379,865 as set out in the receipts and issues out of the Exchequer Account published in Iris Oifigiúilon November 3rd and, if he does include that, does that figure of £3,379,865 include the draft from the Central Bank account to the Minister for Finance of £550,000 drawn by the Minister for Finance from the assets lying to his credit in the Central Bank; and, if he does, does he not think he is misleading the House when he says that the principal and interest of this loan must be redeemed out of the annual revenue of the State without telling the House that the annual revenue of the State includes the drawings made by the Minister for Finance out of the Loan Counterpart Fund to his credit in the Central Bank?
That does not arise out of the question.
In answer to the supplementary speech of Deputy Dillon, I want to say——
Your hand is pinned to the desk.
——that he is trying to subtract a sum which he should add to what we have to pay to the Americans in dollars, whatever the dollars may cost us. Whatever they will cost, it will cost us very many more pounds to buy the dollars to repay the loan borrowed by the previous Government under this arrangement. I want to point out to the Deputy that portion of these——
If my supplementary did not arise out of the question, he is managing to make a great answer.
The supplementary did not arise and, therefore, neither does the answer.
If the Deputy wants to see the assets that portion of these dollars were spent on I will show him 14 acres of land that were drained at a cost of £67 per acre and that would not feed a snipe yet and on which no animal has ever been put. The Irish people not only have to repay the dollars but they will have to collect the taxes to repay these dollars.
If the doom which the Minister's answer and manner imply is as dismal as he would suggest, why did the Government not repay straight away the £24,000,000 of the Marshall Aid Loan that the interParty Government handed over to the Fianna Fáil Government in 1951?
One of the reasons was that we could not buy the dollars for the pounds.
Did you try?
When we were in office before we were able to buy dollars for pounds. (Interruptions.) Deputy Dillon went over and surrendered to the British and said: “We will not ask you to supply us with dollars for pounds any more; we are going to borrow the dollars.” Having borrowed the dollars they spent them on American maize in order to sell the resulting produce to John Bull for pounds.
Might I ask theMinister what steps were taken to buy dollars at that time; what inquiries were made either from the British Government or the United States Government?
Question No. 11.
I certainly know the steps the Deputy and Deputy Dillon took to borrow dollars rather than ask the British Government to supply them.